European stocks notch all-time highs on earnings, Xi-Biden talks
Several European stock indexes hit record highs on Tuesday, boosted by strong corporate earnings, dovish statements from the European Central Bank chief and signs of easing U.S.-China tensions. The pan-European STOXX 600 rose 0.3%, extending a record-breaking run as investors saw a key meeting between U.S. President Joe Biden and Chinese leader Xi Jinping as a sign of improvement in the fraught relationship.
The pan-European STOXX 600 rose 0.3%, extending a record-breaking run as investors saw a key meeting between U.S. President Joe Biden and Chinese leader Xi Jinping as a sign of improvement in the fraught relationship. Blue-chip indexes, including Germany's DAX and France's CAC 40, as well as euro zone shares all rose about 0.3% to new peaks.
ECB President Christine Lagarde, who is slated to speak later in the session, on Monday reiterated her push back against market bets for tighter monetary policy. "We're seeing record highs but only incremental moves, which is a sign of where we stand right now," said Craig Erlam, senior market analyst at OANDA.
"Central banks are pushing for as long as they can to buy time and see if economies are in a good position to raise rates, at which point they could start to safely tweak their language. This is supporting markets." The STOXX 600 has scaled fresh peaks in November as an encouraging earnings season helped investors look past inflationary pressures and a renewed surge in COVID-19 cases across the continent.
Mining stocks, which have a large exposure to China, climbed 0.7% on optimism over the Sino-U.S. talks. The telecom sector was boosted by a 5.3% jump in Vodafone after the company lifted its annual free cash flow outlook. Dutch tech investor Prosus NV rose 2.6% after forecasting higher profit for the first half of 2022 as it gained proceeds to the tune of $12.3 billion from selling part of its stake in Tencent.
French luxury group Kering was among the top gainers on the CAC 40, gaining 2.0% after its top brand Gucci said it expected 2021 revenues to be in line or higher than their pre-pandemic level. HSBC upgraded the stock to "buy". Portuguese food retailer Jeronimo Martins plunged 11% after Asteck, a unit of the Heerema Group, sold its entire 5% stake in the company.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)