European Stocks Close Notably Higher On Strong Earnings, Data

European markets closed notably higher on Friday, as upbeat earnings updates, encouraging economic data and dovish comments from the European Central Bank outweighed concerns about rising coronavirus cases and prompted investors to pick up stocks.

Data showing an acceleration in Eurozone business activity, a jump in U.K. consumer sentiment and retail sales lifted sentiment.

The pan European Stoxx 600 climbed 1.09%. The U.K.’s FTSE 100 gained 0.85%, Germany’s DAX surged up 1% and France’s CAC 40 gained 1.35%, while Switzerland’s SMI ended stronger by 1.28%.

Among other markets in Europe, Austria, Belgium, Denmark, Finland, Greece, Iceland, Ireland, Netherlands, Poland, Portugal, Spain and Sweden closed higher.

Czech Republic, Russia and Turkey closed weak, while Norway ended flat.

In the UK market, Intermediate Capital Group, Just Eat Takeaway, 3I Group, Burberry Group, Natwest Group, Melrose Industries, Unilever and Weir Group gained 2 to 2.8%.

Shares of telecom major Vodafone gained nearly 2.5% after the company reported higher revenues in its first quarter.

Fresnillo and IAG shed 1.7% and 1.1%, respectively. Polymetal International ended nearly 1% down.

In the French market, Valeo climbed more than 7.5%. Faurecia surged up more than 5%, while Kering, STMicroElectronics, Safran, ArcelorMittal, Airbus Group, Hermes International, LVMH, LOreal and Societe Generale gained 1.5 to 3%.

Thales gained about 1.5% after posting solid first-half results and lifted its full-year revenue target.

Dassault Aviation shares gained more than 4.5%, lifted by an announcement from the company that its adjusted net income for the first-half of 2021 came in at265 million euros, up from 87 million euros last year.

In Germany, Daimler rallied more than 5.5%. Continental gained nearly 4%, while Merck, Deutsche Bank, Thyssenkrupp, MTU Aero Engines and BMW moved up 2 to 2.5%.

Infineon Technologies, Puma, Munich RE, E.ON and Deutsche Telekom also closed notably higher.

Shares of Swedish builder Skanska AB climbed nearly 7.5% after the company reported a hefty jump in second-quarter profit.

Swiss chemicals company Lonza Group gained more than 4% after raising its 2021 outlook.

According to a survey, eurozone business activity expanded at its fastest monthly pace in over two decades in July as an easing of containment measures gave a boost to services. IHS Markit’s Flash Composite Purchasing Managers’ Index rose to 60.6 in July from 59.5, its highest reading since July 2000.

Germany’s private sector logged a record growth in July driven by an ongoing rapid recovery in services activity, flash survey results from IHS Markit showed. The composite output index rose to 62.5 in July from 60.1 in June. The latest score was the highest since January 1998 and above economists’ forecast of 60.8.

The services Purchasing Managers’ Index advanced to a record 62.2 from 57.5 in the previous month, while the manufacturing PMI came in at a three -month high of 65.6, up from 65.1 a month ago and economists’ forecast of 64.2.

France’s private sector remained strong in July but the pace of expansion moderated from June, flash survey results from IHS Markit showed on Friday. The flash composite output index dropped unexpectedly to 56.8 from 57.4 in June. The score was forecast to rise to 58.5.

The ECB Survey of Professional Forecasters for the third quarter showed that HICP inflation expectation for this year was raised to 1.9% from 1.6% in the previous round. The projection for next year was lifted to 1.5% from 1.3%.

The Eurozone economic growth forecast for this year was raised to 4.7% from 4.2%, and increased to 4.6% from 4.1% next year.

U.K. consumer sentiment strengthened more-than-expected in July to reach ahead of its March 2020 pre-lockdown level, survey data from the market research group GfK showed. The consumer sentiment index rose to -7 in July from -9 in the previous month. The expected reading was -8.

The IHS Markit/CIPS U.K. flash composite PMI dropped to 57.7 in July from 62.2 in June, its lowest since March and a sharper fall than most economists had expected.

Data from the Office for National Statistics revealed U.K. retail sales recovered in June as the start of the Euro 2020 football championship boosted food store sales. Retail sales grew 0.5% month-on-month in June, reversing a 1.3% fall in May. Sales were forecast to grow 0.4%.