European Stocks Close On Firm Note Again

European stocks closed notably higher on Tuesday, lifted by some strong earnings updates, encouraging economic data, and optimism about interest rate cuts by some major central banks in the second quarter of the year.

The pan European Stoxx 600 climbed 1.14%. The U.K.’s FTSE 100 gained 1.22%, Germany’s DAX advanced 1.4% and France’s CAC 40 ended 0.99% up. Switzerland’s SMI ended up by 1.64%.

Among other markets in Europe, Austrial, Belgium, Denmark, Netherlands, Portugal, Spain, Sweden and Turkiye closed with strong gains.

Finland and Norway ended modestly higher, while Iceland, Poland and Russia closed weak.

In the UK market, DCC, SSE, Barclays Group, Persimmon, Fresnillo, Experian, Weir Group, Flutter Entertainment and Lloyds Banking gained 3 to 4.5%.

Barratt Developments, Land Securities and Rentokil advanced nearly 3%. Glencore, JD Sports Fashion, Spirax-Sarco Engineering, RS Group, Severn Trent, Coca-Cola, Legal & General and Howden Joinery were among the other major gainers in the market.

EasyJet dropped nearly 6%. Burberry Group and Melrose Industries lost 3.5% and 2.05%, respectively. BP drifted down 1.3% and Smith (DS) ended lower by 1%.

In the German market, Infineon soared nearly 13% despite cutting its revenue forecast in the current fiscal year.

Zalando gained about 8.5%. The online fashion retailer backed its full-year guidance after returning to growth in the first quarter.

Covestro climbed about 3.5%. Deutsche Bank, Symrise, E.ON, Commerzbank, RWE, Bayer, SAP, Continental, Deutsche Boerse, Mercedes-Benz, Munich RE and Vonovia gained 1.4 to 2.5%.

Fresenius Medical Care tumbled more than 6%. Rheinmetall ended 2.5% down. Hannover Rueck and Adidas also ended notably lower.

In the French market, Essilor, STMicroElectronics, Pernod Ricard, Societe Generale, Dassault Systemes and BNP Paribas gained 2 to 3.1%.

Credit Agricole, Edenred, Eurofins Scientific, Legrand, AXA, Capgemini, Airbus Group, Michelin, Vinci, Danone, LVMH, Air Liquide, Kering and Schneider Electric also posted strong gains.

WorldLine drifted down more than 3%. ArcelorMittal and Bouygues also ended sharply lower, with the latter turning weak on disappointing results.

In the Swiss market, banking giant UBS Group AG soared nearly 8% as it returned to profit after two loss-making quarters.

On the economic front, data from Destatis showed Germany’s factory orders decreased 0.4% on a monthly basis, confounding expectations for an increase of 0.4%. Nonetheless, the pace of decrease slowed from the revised 0.8% drop logged in February. The statistical office revised the February’s rate of change from +0.2%.

Data from Eurostat showed Eurozone retail sales rebounded 0.8% on a monthly basis in March, in contrast to the 0.3% fall in February. Economists had forecast an increase of 0.6%. Year-on-year, retail sales registered a 0.7% rise after declining 0.5% in February.

Germany’s exports rebounded at a faster-than-expected pace in March, rising 0.9% on a monthly basis, reversing a 1.6% fall in February. At the same time, monthly increase in imports eased to 0.3% from 3% in the previous month.

As a result, the trade surplus increased to EUR 22.3 billion in March from EUR 21.4 billion in the previous month. The surplus was slightly below economists’ forecast of EUR 22.4 billion.

Germany’s construction sector continued to deteriorate sharply at the start of the second quarter amid ongoing weakness in demand, survey results from S&P Global showed on Tuesday.

The construction purchasing managers’ index dropped to 37.5 in April from 38.3 in March.

Data from the customs office showed France’s trade deficit dropped to EUR 5.47 billion in March from EUR 5.61 billion in February. In the same period last year, the deficit totalled EUR 8.1 billion.

UK house prices rose only marginally in April as rising interest rate expectations weighed on the property market, showed on Tuesday.

Data published by the mortgage lender Halifax showed house prices in the U.K. posted a monthly increase of 0.1% in April, which was weaker than the expected 0.2% growth. However, this was in contrast to the 0.9% fall in March.

On a yearly basis, property price growth advanced to 1.1% from 0.4% in the prior month. Nonetheless, the increase was attributed to the base effect of weaker price growth around the same time last year.

The British construction sector advanced at the quickest pace in more than a year in April, largely due to solid rates of growth in the commercial and civil engineering segments, survey results from S&P Global showed.

The Construction Purchasing Managers’ Index, or PMI, rose to 53.0 in April from 50.2 in March. A reading above 50 suggests expansion in the sector.

New car sales in the UK rose for the twenty-first consecutive month and logged the best performance for April since 2021, data from the Society of Motor Manufacturers & Traders, or SMMT, showed Tuesday. New car registrations grew by 1%, the report showed.

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