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Europe: Stocks rise to 3-month high; Roche, Danone gain on sales
[LONDON] Gains in miners and better-than-forecast sales from Danone and L'Oreal SA boosted European stocks for a second day.
Danone and L'Oreal added 3.6 per cent or more. Roche Holding AG rose 2 per cent after demand for its breast-cancer medicines boosted quarterly revenue.
Akzo Nobel NV climbed 5.4 per cent on better-than-estimated profit. A gauge of commodity producers rose to a five-month high, with Anglo American Plc up 8.5 per cent.
The Stoxx Europe 600 Index climbed 1.5 per cent to its highest close since January, as crude prices rose for the first time in five days. Gains in equities are picking up pace after they struggled for fresh momentum since mid-March amid concern over global-growth prospects. A gauge tracking volatility expectations for euro-area shares fell to its lowest level this year.
"Good earnings from Danone, Akzo, and Roche confirm that earnings are not as bad expected," said Christian Stocker, a strategist at UniCredit Bank AG in Munich.
"Next week, earnings from more cyclical companies could change the picture, but for now it's looking pretty good. The oil price recovery overnight has stabilized the market at least at a minimum."
The European gauge has still tumbled 16 per cent since reaching a record a year ago, and optimism over bond-buying measures by European Central Bank President Mario Draghi has given way to skepticism about the efficacy of the stimulus in boosting growth.
The ECB's next meeting on Thursday may provide clues about the path of monetary policy.
"Markets will be looking for future policy hints at the ECB meeting on Thursday as well as reassurances from earnings," said Daniel Murray, the London-based head of research at EFG Asset Management.
"There's going to need to be another catalyst."
Among other shares active on corporate news, Faurecia jumped 7.7 per cent after its 2018 earnings forecast beat estimates. Meggitt Plc gained 6.2 per cent after saying sales increased in the first quarter and reiterating its full-year prediction.
Zalando SE lost 2.3 per cent after the German apparel retailer's revenue missed analysts' projections.