STOXX 600 closes at record high on energy stocks, earnings
The continent-wide benchmark index closed 0.37% higher at 574.43 points
The STOXX 600 index ended at a record high on Thursday, led by gains in energy stocks, while investors also gauged the health of corporate Europe from a batch of earnings reports.
The continent-wide benchmark index closed 0.37% higher at 574.43 points.
Energy stocks added 2.7% and marked their strongest session since mid-April as crude prices surged 5% after the U.S. imposed sanctions on major Russian suppliers.
On the face of it, the announcement of sanctions by the U.S. on Rosneft and Lukoil is a major escalation in the targeting of Russia’s energy sector and could be a big enough shock to flip the global oil market into a deficit next year, said David Oxley, chief climate and commodities economist at Capital Economics.
That said, the lasting impact on the oil market and oil prices will depend on how long any sanctions remain in place, and how effectively they are enforced, he said.
Meanwhile, quarterly updates from European companies were in full swing as market participants looked for signs of whether trade uncertainty was impacting corporate profitability.
Luxury stocks added 1.2%, with Kering climbing 8.7% after the Gucci owner said sales in the previous quarter dropped less than analysts had expected.
On the other hand, travel and leisure stocks slipped 2.2%, hurt by a dour forecast from Sodexo and disappointing results from Evolution. Both stocks shed 7% each.
Shares of STMicroelectronics were halted multiple times during Thursday’s session and last settled 14.1% lower as the chipmaker forecast fourth quarter sales below market expectations due to weak automotive sales.
Dassault Systèmes was not far behind with a 13% loss after the French software company lowered its full-year revenue growth guidance.
Earnings of 50.0% of the STOXX 600 companies that have reported results as of Tuesday exceeded analyst estimates, according to data compiled by LSEG, lower than the 54% beat seen in a typical quarter.