Europe close: Stocks erase losses after strong start Stateside

A strong start on Wall Street helped European markets cut their losses on Thursday, with the Stoxx 600 benchmark pushing into positive territory by the close of play.

Strong gains in Frankfurt – driven by heavyweights Siemens, Deutsche Telekom and Allianz – were helping the index higher, making up for falls in London, Paris, Madrid and Milan.

However, gains were only mild with the pan-European index finishing just 0.1% higher at 496.37. This was the Stoxx 600's third straight day in the black, following a huge 6% sell-off over the preceding three sessions.

“Investors are rapidly relearning the lesson that spikes in volatility do not immediately subside after the initial move," said Chris Beauchamp, chief market analyst at IG.

"Both buyers and sellers this week have had to endure wide swings in price action, which will no doubt come as a surprise after months of quieter trading. Stocks seem to have found a low for now, though it is still early days.”

Economic data was thin on the ground in Europe, though a bigger-than-expected drop in jobless claims Stateside drove a strong start for US markets, as fears of an impending recession which rattled markets earlier this week begin to fade. By the midday mark in New York, the Dow was up 1.4% while the Nasdaq and S&P 500 were both up more than 2%.

Siemens, Deutsche Telekom and Allianz shine bright

German industrial technology conglomerate Siemens rose 2% after holding on to full-year guidance following a big jump in third-quarter profits. Net income totalled €2.13bn in the three months to 30 June, up 48% on last year, with revenues rising 5% to €18.9bn, bolstered by double-digit increases in Smart Infrastructure as demand for AI-driven data centres and energy customers continues to surge.

Deutsche Telekom gained 2% after an 8% increase in its second-quarter core earnings, in line with analysts' consensus.

Also rising 2% in Frankfurt was insurance and asset management titan Allianz after expanding its share buyback plan this year by 50% following record profits in the first half.

In the UK, shares in insurer Beazley surged 11% after the Lloyd's of London syndicate manager interim results smashed expectations.

Meanwhile, London-listed gambling group Entain rose 5% as it raised its annual net gaming revenue and earnings forecast, after a better-than-expected second-quarter performance.