Europe: Shares rise, Irish stocks lead

EUROPEAN shares ended higher on Tuesday (Jul 11) amid investor hopes the US Federal Reserve was nearing the end of its interest rate hiking cycle and as China extended some policy measures to support its battered real estate sector.

The pan-European Stoxx 600 ended 0.7 per cent higher, rising for the third straight session. Irish stocks jumped 2.1 per cent, leading the advance among its continental peers.

Irish stocks were boosted by gains in Kingspan which jumped 15.7 per cent after forecasting record profit for the first half of the year. This also helped the European construction sub-index add 2.4 per cent.

Miners were among top sectoral gainers in Europe, up 1.8 per cent as metal prices rose on Beijing’s support for its property market.

China extended until the end of 2024 some policies in a November rescue package to shore up the real estate sector.

Shares of China-exposed luxury firms including LVMH, Hermes and Richemont rose between 2 per cent and 2.3 per cent while industrial stocks also sensitive to China advanced 1.0 per cent.

Several Fed officials have signalled the US central bank was nearing the end of its rate hiking cycle, with markets now awaiting key data on US consumer prices due on Wednesday for more clarity on whether there has been a considerable slowdown in inflation.

“European markets have edged higher in anticipation that China’s efforts to support its property sector may translate into further measures to support a rebound in economic activity,” said Michael Hewson, chief market analyst at CMC Markets.

“Trading activity however is somewhat subdued with the markets treading water to some extent ahead of tomorrow’s US CPI numbers for June.”

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However, UK’s FTSE 100 lagged other European bourses as a firm pound pressured the exporter-heavy index after data showed robust wage growth in Britain.

German investor morale clouded over in July, the ZEW economic research institute said, reporting a surprisingly sharp drop in its economic sentiment index to -14.7 points from -8.5 points in June.

“European macro indicators are coming in perhaps a little bit worse than expected, while US macro indicators are a little bit better than expected,” said Richard Flax, chief investment officer at Moneyfarm.

Shares of Nordic Semiconductor rose 7.3 per cent after the chipmaker beat second-quarter earnings estimates.

Daimler Truck gained 2.5 per cent after the German automaker raised its profit and revenue guidance on easing of supply chain constraints.

Mercedes-Benz Group shares rose 0.7 per cent after sales in the second quarter rose 6 per cent year-on-year on the back of demand for all-electric and top-end vehicles. REUTERS