© Reuters. FILE PHOTO: A trader works at the Frankfurt stock exchange in Frankfurt, Germany, February 22, 2022. REUTERS/Timm Reichert
By Shreyashi Sanyal
(Reuters) -German shares led the gains among European stocks on Thursday as Siemens jumped after posting an upbeat quarterly profit, while investors awaited the UK budget, which is expected to restore confidence in Britain’s economy.
index rose 0.4%, while the continent-wide index dipped 0.1% by 0926 GMT.
Shares of Siemens jumped 7% to lead both the indexes after the engineering and technology group said its factory hardware and software continued to witness strong demand.
The European industrial goods index added 0.2%.
Britain’s finance minister Jeremy Hunt is expected to announce spending cuts and tax hikes at the Autumn Statement, which he and Prime Minister Rishi Sunak say are required to restore investor confidence after the former government’s failed “mini budget” less than two months ago.
London’s lost 0.4% ahead of the announcement, which is due around 1130 GMT.
“It’s a difficult position that they find themselves in. They’ve got to try and balance the books and deal with the fact that the economy is in a difficult position, so it is a challenging situation for them,” said Mike Bell, global market strategist at J.P. Morgan Asset Management in London.
The STOXX 600 is poised for a second straight monthly gain, with better-than-feared earnings and expectations of smaller interest rate hikes by the U.S. Federal Reserve among the top factors driving gains.
Even as data from the euro zone continues to point at an imminent recession for the bloc, strategists note that markets have started to price in a bottoming in the dour readings.
“Part of the reason why markets rallied so much in the last month or so is because consumer confidence is so low that it became hard to see it get much worse, so when the macro data is so weak, markets assume that you are getting to the troughs in the data,” Bell said.
The European basic resources index dropped 0.4% to lead sectoral falls after prices of base metals slumped against a firmer U.S. dollar. The index is still among the few that have stayed above water so far this year. [MET/L]
NN (NASDAQ:) Group dropped 5.8% to the bottom of Amsterdam’s after the Dutch insurer’s 2025 targets came in below estimates. The AEX dipped 0.2%.
