Mar 1 2024: European shares opened the month on a positive note on Friday, bolstered by the strength in global stocks following favorable U.S. inflation data and optimistic earnings reports, while investors awaited euro zone inflation data for insights into potential monetary policy adjustments.
The pan-European STOXX 600 climbed 0.5% by 9:34 GMT, edging close to a record high, in line with the resilience seen in global equities. Nonetheless, the benchmark index was poised for its first weekly decline in six weeks.
Germany’s DAX advanced by 0.6%, reaching record highs for the seventh consecutive session.
The European technology index gained 0.8%, supported by a surge in AI-related technology stocks worldwide.
Financials led the gains with a 1.2% increase in the banks index. Real estate stocks also rose by 1% amid growing expectations of monetary policy easing, following in-line U.S. inflation figures.
Expected at 1000 GMT, euro zone consumer prices data for February is anticipated to indicate that inflation, which spiked to double digits in 2022, is gradually moving closer to the European Central Bank’s 2% target.
Data earlier this week revealed a slowdown in inflation across European Union members Germany, France, and Spain.
HSBC analysts noted in a report, “The ECB will reaffirm its reliance on data for future decisions and should be more comfortable with the current, less aggressive market expectations.”
While the ECB has maintained interest rates at record levels since September 2023, the first rate cut is projected for June, a forecast echoed by both investors and economists.
In corporate updates, Daimler Truck soared 13.5% after the German truck maker raised its dividend and announced a share buyback program, buoyed by better-than-expected pre-tax earnings for 2023.
Grifols shares surged 18.2% to the top of the STOXX 600 after the Spanish pharmaceutical company confirmed the proceeding of its Shanghai RAAS stake sale and unveiled a new cash flow target for 2024.
Conversely, Swiss logistics group Kuehne und Nagel plummeted 12.6% to the bottom of the STOXX 600 after reporting a larger-than-anticipated decline in annual operating profit, attributed to weaker performance across nearly all its segments.
Saint-Gobain recorded a decrease in sales for 2023, causing shares of the French construction materials group to fall by 4.3%.
The broader construction and materials index experienced the most significant decline, dropping by 0.6%.
