Europe open: Stocks push higher but VW tumbles as emissions scandal widens
European stocks rose in early trade, taking their cue from positive US and Asian sessions and lifted by encouraging comments from European Central Bank chief Mario Draghi.
Draghi said at a forum on banking supervision that the central bank remains ready to act to maintain support for the Eurozone.
At 0910 GMT, the benchmark Stoxx Europe 600 index was up 1% and France’s CAC 40 was 0.9% higher. Germany’s DAX was up 0.3%, underperforming slightly due to heavy losses for Volkswagen.
“European markets have tracked the US and Asia higher in early trading as investor confidence and risk appetite returns,” said Andy McLevey, head of dealing Interactive Investor.
“With a raft of economic data due across the UK, eurozone and US that new found confidence may be tested if any figures disappoint and increase short term volatility.”
On the corporate front, Marks & Spencer rose as it reported a mixed first half. The retailer posted an increase in underlying pre-tax profit as strong food offset weak clothing sales, but statutory half-year profit fell to £170.7m from £225.6m the year before.
UK insurer Legal & General advanced after posting a 14% rise in net cash generation for the first nine months of the year as it said it is ahead of its target to deliver £80m of operating cost savings this year.
Glencore was a high riser after the commodities giant noted “significant progress” on plans to cut net debt to the low $20bns by the end of 2016 and increased output from its mines.
Volkswagen shares tumbled after the beleaguered German car maker admitted that the diesel emissions scandal also included petrol engines.
Barry Callebaut was also under the cosh after the maker of bulk chocolate cut its mid-term volume growth forecast and highlighted the difficult cocoa market this year.
Still to come, investors will eye the release of the US ADP employment report at 1315 GMT, trade balance figures at 1330 GMT and ISM non-manufacturing is at 1500 GMT.