Europe close: Banks add to recent gains alongside another advance for euro
European stocks were in the green on Friday, gaining as a better than expected US jobs report for February served to reinforce the European Central Bank's positive message from the previous session, while the euro rallied.
By the closing bell, the benchmark Stoxx Europe 600 index was ahead 0.09% to 373.23, Germany’s DAX dipped 0.13% at 11,963.18 and France’s CAC 40 was 0.24% higher to 4,993.32.
The Stoxx 600 gauge of Bank shares tacked on another 1.80% as Oil&Gas added 1.18%, even as oil prices slipped again.
Significantly, the euro continued its surge from Thursday after European Central Bank president Mario Draghi said that there was “no longer that sense of urgency” in taking further action against the risk of deflation in the Eurozone.
The central bank indicated that the key to a consistent recovery in inflation would be centred on employment and wage growth.
Draghi sounded slightly more hawkish than expected and that the “ECB is expected to reveal a tapering plan in September, if the Eurozone’s political picture is stable and the inflation is on a solid path toward the bank’s 2% mandate target”, said Ipek Ozkardeskaya, senior market analyst, at London Capital Group.
Reinforcing market sentiment as regards global growth prospects, US non-farm payrolls jumped by 235,000 last month, easily exceeding the 200,000 which economists had penciled in.
In currency markets, the euro added a further 0.79% to trade at 1.0665 against the dollar and was up 0.86% versus the pound to 0.8768.
West Texas Intermediate was down 0.81% to $48.88 a barrel - it went below the $50 mark for the first time in 2017 on Thursday - while Brent crude slipped 0.85% to $51.75.
On the data front, Germany's foreign trade surplus fell to its lowest level in 12 months to €18.5bn in January from €18.3bn the previous month, ahead the €18bn expected. Imports rose 3% month-on-month, while exports increased 2.7%.
French manufacturing output fell 1% in January after a 1% drop the previous month, and below expectations of a 0.5% rise. Year-on-year manufacturing fell 1.3% from a downwardly revised 0.1% rise in December. Overall, French industrial production declined 0.3% following a 1.1% rise in December.
In corporate news, Repsol up 2.49% was after the Spanish oil company said on Thursday it had discovered a giant oil field in Alaska.
Volkswagen gained 0.26% after the German carmaker said it would plead guilty in US courts to three counts of felony as part of a plea agreement with regulators over the diesel emissions scandal.
UBS rose 0.37% after the Swiss bank said it lowered the pay for its former chief executive last year.
Segro fell 5.64% after the property developer launched a rights issue to raise £5873m and will be a remaining stake in joint-venture for a property portfolio near Heathrow Airport.