European shares eye sixth week of gains, luxury stocks shine
Richemont surged 8.6% after beating profit estimates in the first half of the fiscal year and saying it is seeking investors for its loss-making Yoox business, in a move widely expected to appease shareholders. The luxury sector also got a boost from France's LVMH , which gained 0.9% on news that Louis Vuitton was planning to open its first duty-free store in China.
European shares were largely muted on Friday but were on course to mark their sixth straight weekly gains, with luxury stocks flying high on the back of strong earnings from Cartier-owner Richemont.
The pan-European STOXX 600 index was flat after hitting a fresh record high earlier in the trading session. Richemont surged 8.6% after beating profit estimates in the first half of the fiscal year and saying it is seeking investors for its loss-making Yoox business, in a move widely expected to appease shareholders.
The luxury sector also got a boost from France's LVMH , which gained 0.9% on news that Louis Vuitton was planning to open its first duty-free store in China. French blue-chip shares were at all-time highs, with carmaker Renault jumping 3.7% after Morgan Stanley upgraded its stock.
"The earnings season is confirmation to markets that the underlying growth and demand picture is still very strong, even though there are companies talking about supply issues and margin pressures going forward," said Seema Shah, chief strategist at Principal Global Investors. "But you're probably going to get to a point where returns get smaller and you see more volatility - investors will have to make that adjustment in their minds."
The STOXX 600 has seen fresh record highs in November, buoyed by dovish central bank messages, upbeat earnings reports, and signs of post-pandemic economic revival. However, ECB policymakers admitted on Friday that euro zone inflation may decline more slowly than earlier thought, partly due to supply chain bottlenecks that were more persistent than previously expected.
Further, Europe has become the epicenter of COVID-19 again, with Germany, France, and the Netherlands experiencing a surge in infections, and prompting some governments to consider re-imposing lockdowns, according to fresh data. Oil and mining stocks led losses in the STOXX 600, dipping 0.8% each as crude and metal prices were dented by a firmer U.S. dollar owing to market bets of an earlier-than-expected Federal Reserve rate hike.
Italian infrastructure firm Atlantia rose 0.5% after raising its 2021 forecast, while Dutch oil and chemical storage group Vopak also advanced 1.2% after beating estimates for quarterly profit.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)