European Stocks Close On Firm Note

European stocks closed on a firm note on Tuesday with investors digesting the latest batch of earnings and economic updates, and assessing the likely moves of major central banks with regard to interest rates.

The pan European Stoxx 600 climbed 0.63%. The U.K.’s FTSE 100 gained 0.9%, Germany’s DAX climbed 0.76% and France’s CAC 40 ended 0.65% up, while Switzerland’s SMI drifted down 0.26%.

Among other markets in Europe, Austria, Denmark, Finland, Greece, Iceland, Netherlands, Norway, Portugal, Russia, Spain, Sweden and Turkiye closed higher.
Belgium and Poland ended flat.

In the UK market, BP rallied nearly 6% after the oil giant reported its second-highest annual profit in more than decade and announced a $1.75bn share buyback.

Weir Holdings, Kingfisher, Prudential, JD Sports Fashion, Antofagasta, BAE Systems, Ashtead and Rollls-Royce Holdings gained 2.3 to 4%.

HSBC Holdings, Barratt Developments, Hikma Pharmaceuticals, Next, Anglo American Plc, Fresnillo, IMI, AstraZeneca, Marks & Spencer, St. James’s Place, Natwest Group, Berkeley Holdings, Taylor Wimpey, Frasers Group and Spirax-Sarco Engineering also ended sharply higher.

Pearson, Entain and BT lost 2.5 to 2.7%. Coca-Cola ended lower by about 1.4%, while GSK, National Grid and British American Tobacco lost 0.7 to 1%.

In the German market, Qiagen surged 5.7%. Siemens Energy, Covestro and Bayer climbed 2.4 to 2.75%.

Siemens Healthineers, Fresenius Medical Care, BASF, Zalando, Siemens, Sartorius, HeidelbergCement, MTU Aero Engines, Daimler Truck Holding and Mercedes-Benz gained 1.2 to 1.7%.

Infineon shed about 3.1% after cutting its FY24 outlook. RWE drifted down 2.8%, while Deutsche Bank and Porsche ended lower by 1.6% and 1.4%, respectively.

In Paris, Schneider Electric, ArcelorMittal, Air Liquide, TotalEnergies, Teleperformance, Airbus Group, Kering, Stellantis and Thales gained 1.5 to 2.5%.

Essilor, Pernod Ricard, Safran, Saint Gobain, Legrand and Michelin also closed notably higher.

WorldLine, BNP Paribas, Societe Generale and Edenred lost 1.2 to 1.7%. Renault drifted lower after Stellantis Chairman John Elkann denied the carmaker had merger plans.

Veolia, Carrefour and STMicroElectronics also closed weak.

Data from Destatis showed German factory orders registered a monthly expansion of 8.9% in December, after remaining unchanged in November. Orders were forecast to fall 0.1%. On a yearly basis, factory orders advanced 2.7%, in contrast to the 4.7% decline a month ago.

Survey results from S&P Global showed Germany’s construction sector contracted sharply at the start of the year with sustained declines in activity, new orders and employment. The HCOB construction Purchasing Managers’ Index fell to 36.3 in January from 37.0 in December. The latest score was one of the lowest in the series history and well below the neutral 50.0 mark.

Data from Eurostat showed Eurozone retail sales declined more than expected in December, falling by 1.1% on month, in contrast to the 0.3% increase in November. This was the first decline in three months. Economists had forecast sales to drop 0.9%.

The annual fall in retail sales volume doubled to 0.8% from 0.4% in November. Sales were forecast to fall 0.9%.

The UK construction activity contracted at a slower pace in January as business optimism reached a two-year high, survey results from S&P Global showed.

The construction Purchasing Managers’ Index posted 48.8 in January, up from 46.8 in the previous month. The index remained below the neutral 50.0 threshold for the fifth consecutive month, signaling a moderate decrease in total activity.