German stocks hit new record high, outperform STOXX 600
written by Bella Palmer
The German index is up around 18.7 per cent so far this year, outperforming the 10 per cent gains on the pan-European STOXX 600 index
German stocks reached a new record high on Tuesday on gains in industrial stocks and insurers, while data showed a services sector downturn in the euro zone's largest economy eased in November.
Germany's DAX jumped 0.8 per cent, on strong gains in Allianz and Daimler Truck Holding, while the STOXX 600 index ended up 0.4 per cent.
The German index is up around 18.7 per cent so far this year, outperforming the 10 per cent gains on the pan-European STOXX 600 index.
Business activity in Germany and the overall euro zone dropped in November, although at a slower rate than in the previous month, according to surveys.
In the meantime, ECB conservative Isabel Schnabel noted further interest hikes are "rather unlikely", after an unexpectedly big drop in inflation, driving bond yields steeply lower.
Rate-sensitive real estate stocks led sectoral gains in Europe, rising 1.8 per cent.
China-exposed HSBC and Prudential slid after Moody's outlook cut China's credit ratings.
With Moody's switching China to a negative outlook, the expectation is that the slowing economic growth is going to have a knock-on effect for big international firms, said Danni Hewson, head of financial analysis at AJ Bell.
Miners were the top sectoral decliners, losing 0.9 per cent as metal prices dropped on concerns over demand from top consumer China.
Italy's blue-chip index breached the 30,0000-point mark for the first time since 2008. Pirelli added 4.9 per cent to top the index after UBS upgraded the Italian tyre maker to "buy" from "neutral".
In economic data, the European Central Bank's October consumer expectations survey showed inflation expectations among euro zone consumers held steady last month while the outlook for economic growth worsened.
Euro zone producer prices increased as expected in October compared with September, while the drop from a year earlier eased.
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