Sika, St Gobain rise on earnings updatesShell flags $400 mln hurricane hitLuxury stocks among top boosts
Oct 7 (Reuters) – European stocks marked their best showing since July on Thursday, as easing oil and gas prices offered relief to investors worried about runaway inflation, while positive earnings updates added to the upbeat sentiment.
Stock market volatility has spiked in recent weeks on concerns about soaring energy prices spurring inflation and interest rates, debt problems at property developer China Evergrande (3333.HK) and risks from tighter monetary policies.
However, oil prices dropped for a second session after an unexpected rise in U.S. crude stocks, and European gas futures fell back from record highs as Russian President Vladimir Putin said Russia would boost gas supplies to Europe amid an energy crunch. read more
But strategists at UBS warned Russia’s supplies may not have a lasting impact in taming prices.
“Russian gas exports to Europe are already running at elevated levels, and we think it’s difficult for Russia to accelerate its shipments further in time for the European winter season,” UBS said.
The auto and parts sector (.SXAP) jumped 3.2% for its best day in three months.
The automakers-heavy German DAX index (.GDAXI) logged its best session since May, up 1.9%, shrugging off data that showed the country’s industrial output in August dropped the most since April last year. read more
Also brightening the mood were a reprieve on the U.S. debt ceiling front, after U.S. Senate leaders agreed to extend the borrowing limit into December, and fewer than anticipated jobless claims in the country were recorded. read more
Sika (SIKA.S) rose 3% after the Swiss construction chemicals maker said it could overcome rising raw material costs and supply chain restrictions to increase its sales and profit margins this year. read more
A similar tone from French construction materials company St Gobain (SGOB.PA) and a stock buyback announcement lifted its shares 4.2%.
With third-quarter earnings set to kick off, analysts expect a slowdown in profit growth as a post-pandemic rebound normalises. Profits for STOXX 600 companies are seen rising 45.6%, compared with a 152.6% surge in the second-quarter, according to Refinitiv IBES data.
French car parts maker Valeo (VLOF.PA) climbed 5.9% after a Citigroup upgrade.
Reporting by Sruthi Shankar and Anisha Sircar in Bengaluru; Editing by Subhranshu Sahu, Rashmi Aich and Steve Orlofsky
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