Europe midday: Meggitt deal drives market as investors digest PMIs
European hovered just below record highs at midday on Monday following as Asian shares rebounded overnight and UK engineer Meggitt soared on a £6.3bn US buyout.
The pan-European STOXX 600 index was up 0.48%, having hit an all-time high of 465.84 points. earlier in the session.
Investors were also digesting final Markit manufacturing purchasing managers’ index readings for July which showed euro zone factory activity continuing to accelerate despite shortages of raw materials and rising costs. The final reading came in at 62.8, down from June’s all-time high of 63.4 but ahead of a preliminary estimate of 62.6.
The sector has now recorded successive months of expansion since July 2020. In Germany, the rate of growth hit a three-month high that was the third-highest on record, behind March and April. The PMI rose to 65.9 in July from 65.1 in June, coming in above the flash estimate of 65.6.
UK manufacturing activity slowed to 60.4 from June’s 63.9, having peaked at a record 65.6 in May.
In equity news British aero-engineer Meggitt was the standout gainer, soaring 59.2% after US industrial firm Parker-Hannifin said it would buy UK rival in a deal that values it at £6.3bn.
HSBC gained after Europe’s biggest bank beat forecasts for first-half pretax profit and reinstated dividend payments.
French insurer Axa rose after it posted a 180% surge in first-half net income, while bigger rival Allianz fell after US regulators started a probe relating to Allianz Global Investors’ Structured Alpha Funds.
Heineken shares were up as the brewing giant doubled its first-half operating profit to €1.63bn but warned of rising costs.
British jet and auto parts supplier Senior jumped after it reported a first-half profit compared with a loss a year earlier. Peer Melrose gained 5.87%, while Rolls-Royce was up 3%.