Europe open: Stocks push up as investors continue to cheer prospect of further QE
European stocks rose in early trade, tracking gains in the US and Asia as investors continue to take heart from European Central Bank president Mario Draghi’s dovish comments on Thursday.
At 0850 BST, the benchmark Stoxx Europe 600 index was up 1.1%, France’s CAC 40 was up 1.2% and Germany’s DAX was 1.3% higher.
Although Draghi stood pat on policy, he hinted that additional stimulus measures could be announced at the December meeting.
In the press conference after the rate announcement, the ECB chief said the governing council had discussed expanding its bond-buying programme and cutting the rate on reserves held at the central bank.
“Yesterday’s comments by ECB chief Draghi have certainly been a bit of a game changer. Not only were they much more dovish than expected, he also made it very clear that the ECB is ready to act in a decisive manner to boost growth and fight deflation if needed, possibly as early as December,” said Markus Huber, senior analyst at Peregrine & Black.
“This in return is not only boosting confidence in the Eurozone economy but also indirectly lowers the risk for investors in the months ahead.”
Earnings came thick and fast on Friday.
Electrolux rose after the home appliances maker posted a 9% increase year-on-year in third-quarter net sales.
Sweden’s Volvo was also in the black after it said third-quarter operating profit rose to 5.1bn Swedish crowns from 2.9bn in the same period last year.
Gucci owner Kering advanced as it posted a 12% rise in third-quarter revenue to €2.89bn, while miner Boliden rallied after reporting an increase in third-quarter net profit.
On the downside, Ericsson slid after the Swedish telecom equipment maker’s third-quarter revenue missed analysts’ expectations, while shipping company Moller Maersk tumbled after cutting its full-year profit outlook.
In London, William Hill slumped after the bookie warned that full-year operating profit will come in at the bottom end of analysts’ forecasts as a result of additional taxes on the gambling industry and a tough comparison with last year.
TalkTalk was also under the cosh after saying a criminal investigation was launched by the Metropolitan Police cyber crime unit on Thursday following a “significant and sustained” cyberattack on the company’s website.