Europe open: Shares up as upbeat earnings overshadow Covid worries
European shares opened the week higher on upbeat earnings reports and strong China GDP data as investors set aside worries over increasing coronavirus infections and renewed lockdowns.
The pan-European STOXX 600 index rose 0.78% with all major bourses higher.
China’s economy grew 4.9% between July and September compared to the same quarter last year, coming in weaker than economists’ expectations for 5.2% growth.
Luxury stocks such as LVMH and Hermes, reliant on wealthy Chinese customers, rose on the news.
Across Europe, Covid-19 curbs were being reintroduced as government’s battled to quell the latest wave of the pandemic.
“Rising case numbers across Europe is raising the risk of a second recessionary wave, but ample central bank support means we are holding the September - October range,” said Markets.com chief analyst Neil Wilson.
“Meanwhile in the US, House Democrat leader Nancy Pelosi said she is ‘optimistic’ about getting a pre-election stimulus deal agreed. Lots of chatter around this dictating some of the price action but not a lot of substance – what we do know is that some kind of stimulus package is on its way. “
In corporate news, shares in health technology company Philips rose as the company reported a much better-than-expected 32% jump in core earnings.
Julius Baer shares were up after the bank indicated an improvement in profitability for the first nine months of 2020 as client activity increased and it cut costs.
Shares in Danone were also higher as the world's largest yoghurt maker reinstated its 2020 forecasts and launched a review of its assets.
Italian infrastructure operator Atlantia rose as the company agreed to sell a 49% stake in its highway toll-collection business Telepass to investment manager Partners Group for €1.06bn.
Swedish defence company Saab shares fell more than 10% as the company reported a fall in third-quarter profits and repeated that it could not confirm its full-year guidance due to the uncertainty caused by the pandemic.
Saab’s adjusted operating profit fell to SEK445m (£38.8m) from SEK518m a year ago, while order bookings increased 8% to SEK10.15bn.