Europe open: Shares flat amid earnings deluge; SimCorp surges on bid
European shares were flat at the open on Thursday as worries about banking sector stability continued to overshadow yet another massive dump of corporate earnings and updates.
The pan-regional Stoxx 600 index barely moved the needle in early trade. Investors are also eyeing preliminary US GDP estimates.
‘’Investors are waiting for the curtain to go up on the next instalment of the drama of the slowing US economy with the drag effect of rapid interest rates hikes expected to start showing up in today’s snapshot of output,” said Hargreaves Lansdown analyst Susannah Streeter.
“The stage is set for a report of strong spending in the first three months of the year, helping lift activity, with GDP growth forecast to come in at 2% on an annual basis, down from 2.6% in the fourth quarter. But conditions towards the end of the quarter are expected to show a deterioration, as banking worries swirled, with companies and consumers becoming more cautious, so the figure may well surprise on the downside.”
In equity news, the focus was firmly on banks, with Deutsche Bank shares up as it recorded its 11th straight quarterly profit, while Barclays also rose after a 16% jump in profit driven by higher rates and gains in its consumer credit card division.
Shares in US regional bank First Republic tumbled almost 30% overnight as investors continued to be concerned over its overall health. On Monday, the bank said that deposits dropped 40% to $104.5bn in the first quarter.
SimCorp shares surged by almost 40% after Deutsche Boerse said it has offered to buy the Danish software maker SimCorp for 29bn Danish kronor (€3.9bn).
AstraZeneca shares rose after its results beat estimates.
Reporting by Frank Prenesti for Sharecast.com