Europe close: Stocks continue advance
European stocks finished up but off their highs as investors remained optimistic about President-elect Trump's policies.
The benchmark Stoxx Europe 600 index was up 0.13%, Germany’s DAX was 0.24% higher and France’s CAC 40 was 0.43% firmer. The Stoxx 600 basic resources index rose 1.88%, while the sub-index for banks was 2.16% stronger.
Oil prices fell, however, amid ongoing concerns about oversupply, with Brent crude down 1.08% to $44.28 per barrel and West Texas Intermediate down 0.65% to $43.15.
Head of Research at Accendo Markets Mike van Dulken said: “Equities are making a positive start to the week, continuing to digest the prospect of a Trump Presidency rather well. Investors appear to like the less controversial character who has addressed the media since winning. Key appointments have also been well received and bullishness is rising in his spending, tax cut and deregulation plans. A breath of fresh air for a developed world still stuck in a post-crisis low growth, low inflation, low rates, stimulus-focused funk. Perhaps Donald is just what markets need, however surprising that may sound.”
On the data front, industrial production in the 19 countries that share the euro fell less than expected in September, according to figures released by Eurostat.
Industrial production was down 0.8% month-on-month in September compared to a 1.8% rise in August, but beating expectations of a 1% decline.
In corporate news, Societe Generale and UniCredit were in focus amid rumours of a possible merge between the two.
Siemens rose after agreeing to buy US-based Mentor Graphics in a $4.5bn all-cash deal.
German utility RWE reversed an earlier rally after saying 2016 earnings were expected to be at the upper end of its guidance range.
Housebuilder Taylor Wimpey advanced as it said in a trading update that the UK housing market remained resilient, despite the implications of Brexit still being unclear, and hailed strong trading in the second half.
Irish distribution and business support services company DCC surged after reporting a rise in half-year revenue and saying full-year operating profit is likely to be ahead of market expectations.
Legal & General was on the front foot after announcing the completion of a £1.10bn pension buyout deal with Rolls-Royce.
Standard Life gained ground despite saying that the possible combination involving its Indian joint venture, HDFC Life, and Max Life Insurance Company, Max Financial Services and Max India, had hit a roadblock.
Bookmaker William Hill turned lower following earlier gains after it said it expected full-year adjusted operating profit to be the top end of its guidance.
Tesco rallied as HSBC upped its stance on the stock to ‘buy’ from ‘hold’.
British platinum producer Lonmin’s shares rose as it said losses in the year to the end of September narrowed thanks in part to the restructuring of the business, a continued focus on cost management and the weakening of the rand against the US dollar.
Investors in Europe were also digesting some mixed data out of China. The country’s fixed-asset investment was up 8.3% in the January-to-October period, ahead of forecasts, but industrial output and retail sales growth in October fell short of analysts’ expectations.