European shares rise after slew of upbeat corporate earnings

European shares rose on Wednesday as a slate of upbeat earnings from companies including Infineon, AXA and Just Eat Takeaway offset some fears of a slowdown following gloomy business activity data from the region.

Equities had dropped on Tuesday after weak global factory data and amid concerns that US House of Representatives speaker Nancy Pelosi’s visit to Taiwan could escalate tensions between Beijing and Washington. Ms Pelosi departed Taiwan on Wednesday.

DUBLIN

The Iseq index advanced almost 1.8 per cent amid the recovery in investor sentiment. Ryanair rose 2.3 per cent to €12.66 after it reported record-high monthly passenger numbers. The airline said 16.8 million people flew with it in July, up 13.5 per cent on the numbers who did so in the same month in 2019.

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On a good day for bank stocks, Bank of Ireland climbed 5.3 per cent to €6.01, while AIB finished 2.7 per cent higher at €2.31. Building materials group CRH was another gainer, adding 1.9 per cent to close at €37.30, while packaging group Smurfit Kappa rose 2.6 per cent to €36.60.

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Kerry was among the few main Irish stocks to drop, with the food group slipping 0.6 per cent to €104.75.

LONDON

The blue-chip FTSE 100 index climbed 0.5 per cent, while the mid-cap FTSE 250 index gained 0.7 per cent.

Avast surged 43.8 per cent to an all-time high after Britain’s competition regulator said it has provisionally cleared cybersecurity firm NortonLifeLock’s $8.6 billion (€8.47 billion) purchase of its rival.

All eyes are on the Bank of England’s meeting on Thursday where policymakers are expected to raise interest rates by 50 basis points after other central banks pushed up borrowing costs sharply in recent weeks, despite the risk of an economic slowdown or a recession. UK banks rose 1.5 per cent ahead of the decision.

Homebuilder Taylor Wimpey gained 5.5 per cent after it forecast annual operating profit near the top end of market consensus range.

EUROPE

The Stoxx 600 index gained 0.5 per cent, recouping losses from the last two days, despite the emergence of data showing business activity in the euro zone contracted slightly in July for the first time since early last year as consumers reined in spending amid a cost-of-living crisis.

Shares in Just Eat Takeaway, Europe’s largest meal delivery company, rose 5.4 per cent after it posted a smaller than expected loss for the first half of 2022. German microchip supplier Infineon rose 5 per cent after reporting a rise in quarterly revenue and lifting its full-year outlook as it continues to benefit from a semiconductor shortage.

French insurer AXA firmed 5.7 per cent after announcing a new share buyback programme as it posted a 3 per cent rise in first-half net profit, while Commerzbank added 2.5 per cent on a bigger-than-expected second-quarter net profit.

Société Générale jumped 3.1 per cent as buoyant activity across retail and investment banking helped the bank report a smaller-than-expected loss in the second quarter.

Weighing on shares, Novo Nordisk fell 9.4 per cent. The Danish drug maker lifted sales and profit forecasts for the year on strong first-half earnings, but analysts pointed to downbeat sales of Wegovy, its new obesity drug.

NEW YORK

Wall Street stocks rose in early trading as corporate earnings continued to roll in and economic data came in better than expected. Treasuries trimmed earlier declines as traders priced in the possibility of further interest-rate hikes from the Federal Reserve.

Earnings set the tone for stocks, with solid reports from Moderna and PayPal Holdings lifting the Nasdaq 100 as much as 2.5 per cent and pushing it to a level last seen in May. The S&P 500 also rose as much as 1.5 per cent after new data eased concerns of a broader economic slowdown.

— Additional reporting: Reuters/Bloomberg