European Markets Close Higher As Investors React To Results, Eye Fed Policy

Despite data showing a rise in eurozone inflation, European stocks closed higher on Wednesday as investors digested a slew of encouraging earnings updates from U.S. and European companies, and looked ahead to the Federal Reserve’s monetary policy announcement later in the day, the Bank of England’s policy move on Thursday.

The pan European Stoxx 600 climbed 0.8%. The U.K.’s FTSE 100 gained 1.13%, Germany’s DAX advanced 0.53% and France’s CAC 40 ended up 0.76%, while Switzerland’s SMI gained 0.29%.

Among other markets in Europe, Denmark, Finland, Greece, Netherlands, Norway, Poland, Portugal and Sweden closed higher.

Belgium, Iceland, Spain and Turkiye ended weak, while Austria and Russia closed flat.

In the UK market, Antofagasta rallied about 4.6%. HSBC Holdings gained 4% after the lender announced a share buyback of up to $3 billion after reporting a stable first-half profit.

ICG, Ashtead Group, Spirax Group, Anglo American Plc and Glencore ended higher by 3 to 3.5%. Halma surged nearly 3%.

Mining firm Ferrexpo gained 4% after half-year profits more than doubled. Shell, Prudential, Fresnill, IMI, Scottish Mortgage, Pershing Square Holdings, Diploma, RightMove, Rio Tinto, 3i Group, Melrose Industries and Croda International gained 1.8 to 2.7%.

Intercontinental Hotels Group dropped nearly 3%. GSK, Easyjet and Convatec Group lost 2%, 1.8% and 1.25%, respectively.

In the German market, Siemens Energy climbed nearly 6%. Sartorius and Fresenius gained 4.2% and 3.8%, respectively.

Infineon, SAP, Rheinmetall and Qiagen ended higher by 1 to 1.6%. TeamViewer surged more than 13%. The provider of remote connectivity solutions reiterated annual revenue guidance after Q2 revenue beat expectations.

Siemens Healthineers tumbled 6.5% after missing Q3 sales and earnings forecasts.

Adidas ended down 2.2%, while Zalando, Volkswagen, Deutsche Bank, HeidelbergCement, BMW and Beiersdorf closed lower by 1 to 1.5%.

In the French market, Teleperformance soared nearly 11%. Legrand rallied about 6%. Airbus gained 4.8% after reporting half-year results. Schneider Electric ended 3.25% up, after reporting better-than-expected H1 earnings and raising its outlook.

Danone gained nearly 2.5% after revenue rose more than expected in the second quarter.

L’Oreal, Dassault Systemes, ArcelorMittal, Renault, Saint Gobain, Edenred, Eurofins Scientific and Pernod Ricard gained 1 to 2.5%.

Accor, BNP Paribas, Kering, Safran, Vinci, Stellantis and Capgemini ended down 0.6 to 1.3%.

ASML rallied 5.6% after Reuters reported the Biden administration planned to exempt chip equipment makers from Japan, the Netherlands and South Korea from upcoming export restrictions.

On the economic front, eurozone inflation rose slightly in July, while core inflation remained stable, flash data from Eurostat showed. The harmonized index of consumer prices advanced 2.6% year-on-year in July, faster than the 2.5% increase in June. The index was forecast to climb 2.5%.

Germany’s import prices increased for the first time in sixteen months in June, and at a faster-than-expected pace, data released by Destatis showed.

Import prices climbed 0.7% year-over-year in June, reversing a 0.4% fall in May. The expected increase was 0.5%.

Germany’s jobless rate remained unchanged in June, the labor force survey results from Destatis showed. The unemployment rate stood at adjusted 3.4%, the same as in May.

France’s consumer price inflation increased marginally in July amid an increase in energy costs, a provisional estimate from the statistical office INSEE showed.

A separate official report showed that producer prices declined for the seventh straight month in June.

The consumer price index climbed 2.3% year-over-year in July, following a 2.2% rise in the previous month. This slight rise in inflation was largely due to the surge in energy prices, partly offset by the fall in service and food prices, the agency said.