BERLIN, Aug 2 — European stocks scaled fresh peaks today, driven by dealmaking activity and strong results from Europe’s biggest bank HSBC, with a rebound in Asian stocks also helping set a bright start to August.
The pan-European STOXX 600 index rose 0.6 per cent to hit an all-time high of 464.5 points, with retailers, automakers and miners among the top performers.
British aero-engineer Meggitt soared 58.2 per cent to hit a life high after US industrial firm Parker-Hannifin said it would buy the UK rival in a deal valued at US$8.76 billion (RM37 billion).
Among other deals, British asset management services provider Sanne Group jumped 7.9 per cent after it said it could get a takeover bid from fund servicer Apex Group.
UK’s midcap index gained 0.6 per cent, while the blue-chip FTSE 100 index added 0.8 per cent.
In earnings, Asia-focussed lender HSBC inched up 0.5 per cent after it beat forecasts for first-half pretax profit and reinstated dividend payments.
French insurer Axa gained 2.5 per cent after it posted a 180 per cent surge in first-half net income, while German rival Allianz tumbled 6.4 per cent after US regulators started a probe relating to Allianz Global Investors’ Structured Alpha Funds.
Of the more than half of the STOXX 600 companies that have reported second-quarter results so far, 67 per cent have topped profit estimates, as per Refinitiv IBES data.
“Having reached all-time highs post 1Q results, the breadth of positive EPS revisions in Europe remains very strong both in absolute terms and versus peers,” European equity strategists at Morgan Stanley said in a note. “Europe now sees the best earnings revisions of all global regions.”
Meanwhile, a survey showed manufacturing activity across the euro zone continued to expand at a blistering pace in July, but supply bottlenecks sent input costs soaring.
Optimism around European earnings and economic reopening helped the benchmark STOXX 600 end July with a sixth straight month of gains despite concerns about inflation, soaring virus cases in Asia and a major regulatory crackdown in China.
British jet and auto parts supplier Senior Plc jumped 4.3 per cent after it reported a first-half profit compared with a loss a year earlier.
Peer Melrose gained 6.2 per cent, while Rolls-Royce added 3.5 per cent.
The world’s second-largest brewer Heineken inched up 0.6 per cent after reporting first-half earnings above expectations, but warned rising commodity costs would eat into margins.
German carmaker Daimler rose 2.2 per cent after Goldman Sachs added the stock to its conviction list. — Reuters
