Europe midday: Stocks gain as ECB member comments underpin sentiment
European stocks enjoyed healthy gains on Tuesday as comments from European Central Bank members underpinned sentiment.
CAC 40
8,105.78
17:00 23/04/24
Daimler AG
€70.16
16:30 19/03/24
DJ EURO STOXX 50
5,008.17
23:59 23/04/24
Financial Services
14,129.27
16:59 23/04/24
Food Producers & Processors
8,195.93
16:59 23/04/24
FTSE 100
8,044.81
16:49 23/04/24
FTSE 250
19,799.72
16:59 23/04/24
FTSE 350
4,424.29
16:59 23/04/24
FTSE All-Share
4,378.75
17:14 23/04/24
ICAP
469.70p
17:09 14/12/16
Mobile Telecommunications
1,837.32
16:59 24/01/22
Renault
€47.66
16:40 23/04/24
Unilever
3,861.00p
16:40 23/04/24
Vodafone Group
69.62p
16:40 23/04/24
Xetra DAX
18,137.65
17:00 23/04/24
The initial boost came as investors welcomed comments from Benoit Coeure, an executive board member at the European Central Bank, who said the bank would front-load asset purchases in May and June due to low market liquidity during the summer months. Coeure made the comments in a speech delivered on Monday at a conference in London.
Also giving stocks a lift were remarks from ECB governing council member Christian Noyer, who was speaking at a conference in Paris on Tuesday. He said that recent indicators suggest the bank’s quantitative easing measures have had a positive impact on inflation expectations and that the ECB is ready to take further action if needed.
The comments weighed on the euro, which fell to $1.1212, but lifted stocks. By 1155 BST, the Stoxx Europe 600 index was up 1.1% at 402.60, while the CAC was 1.6% higher at 5,092.65 and Germany’s Dax was up 1.7% at 11,785.89.
“Equity markets are ecstatic over the news that the ECB will front-load its bond buying scheme, and the short-term boost to the QE scheme has driven stock markets around Europe higher,” said David Madden, market analyst at IG. “The euro smashed through the $1.12 level as traders moved quickly to short the single currency, and this in turn is making eurozone stocks even more attractive to investors outside the currency region,” he added.
The positive mood meant investors were able to shake off a downbeat ZEW survey that showed the economic sentiment index fell to 41.9 from 53.3 a month earlier, falling short of expectations for a reading of 48.
Elsewhere, figures released by Eurostat showed that consumer prices in the Eurozone were flat year-on-year in April, confirming an earlier estimate.
Although events in Greece were not key to market moves on Tuesday, it remained in focus. Finance Minister Yanis Varoufakis said in an interview with Star TV Channel on Monday that his government is “very close” to an agreement to unlock more creditor aid, but market participants are sceptical.
In corporate news, Unilever shares rose 1% after the company announced that its chief financial officer Jean-Marc Huet has decided to step down from his role after four and a half years, to be replaced by Graeme Pitkethly, the executive vice president of Unilever's UK and Ireland business.
Julius Baer also gained 1% after the company reported a 1% drop in assets under management for the first four months of the year.
Vodafone bucked the trend, off 2.8% after posting a drop in adjusted operating profit and delivering a more cautious outlook than investors had expected.
Interdealer broker ICAP reversed early losses to trade a touch higher. The company posted a 21% fall in full-year profit and saying it expects headwinds to continue.
In terms of sectors, car makers fared well after data showed that European car sales rose for a 20th consecutive month in April. BMW rose 2.8% while Daimler added 2.7% and Renault was 3.3% higher.
Still to come, investors will eye the release of US, housing starts for April at 1330 BST.