Novo Nordisk Stock Soars, Boosting European Markets

European shares reached a peak after Novo Nordisk's significant stock rise, fueled by U.S. approval of its weight-loss pill. The healthcare sector outperformed, driving market gains amid tough competition. Novo's stock recouped previous losses, regaining momentum against rival Eli Lilly in the obesity drug market.

European shares reached new heights on Tuesday, driven by robust gains in the healthcare sector. This surge was significantly influenced by Novo Nordisk, whose shares jumped 9.2% after clinching U.S. approval for its weight-loss pill, offering a competitive edge over Eli Lilly in the lucrative obesity drug market.

The healthcare sector emerged as an outperformer, advancing 1.4% amid enthusiastic market response. Danni Hewson from AJ Bell highlighted the importance of this development, especially after a challenging period for Novo Nordisk as it grappled with maintaining its market leadership. Concurrently, eurozone equity volatility reached its lowest in over a year.

Elsewhere, basic resources thrived alongside a silver price surge, though the materials sector observed speculative overbought conditions. Despite mild downturns in the automotive sector, the STOXX 600 index appeared set for a robust annual finish, benefiting from macroeconomic factors like declining interest rates and strategic portfolio diversification.

(With inputs from agencies.)