MILAN/FRANKFURT: European stocks rose on Wednesday, as a rebound in beaten-down travel stocks and gains for Adidas and other sports names took the edge off data that highlighted an uneven path for economic recovery in the euro zone.
With Covid-19 cases rising again in Europe, countries including Britain reimposed restrictions to limit the spread of the virus, triggering the worst selloff in three months for the pan-European STOXX 600 benchmark on Monday.
The index closed 0.6% higher, recovering for a second session from the losses, with London’s FTSE 100 up 1.2%, Germany’s DAX gaining 0.4% and France’s CAC 40 rising 0.6%.
Travel stocks rebounded after a four-day run of losses, with Germany’s Lufthansa up 1.6% after news the airline was planning to make rapid Covid-19 antigen tests available to passengers in October.
Adidas jumped 4.4%, while Puma and JD Sports gained about 4% each after US sportswear maker Nike reported strong earnings and forecast better-than-expected sales for 2020.
Osram Licht surged 14.1% after Austrian sensor maker ams said it had signed a so-called domination and profit and loss transfer agreement as a key step towards closing its 4.6 billion euro ($5.4 billion) takeover of the German firm.
Danish pharmaceutical company Genmab fell 5.2% after it said it was locked in a legal battle with its partner Johnson & Johnson over royalty payments for its key cancer drug.
Swiss drugmaker Roche slipped nearly 2% as its experimental Alzheimer’s drug failed to slow cognitive and functional decline in a trial.
IHS Markit’s survey released earlier showed eurozone business growth ground to a halt in September, as fresh curbs to quell a resurgence in Covid-19 infections slammed the services industry into reverse, more than offsetting the strongest manufacturing growth in two years.
However, investors counted on further stimulus from central banks and governments to battle the economic fallout of the health crisis.
“We expect data to further deteriorate given the new restriction measures put in place... which will impact employment data and keep pressure on both European governments and the ECB in the coming months,” wrote Olivier Konzeoue, FX Sales trader at Saxo Markets.
UK markets outperformed, with British finance minister Rishi Sunak looking to set out the future of the coronavirus job support package on Thursday, just weeks before the 52 billion pound ($66 billion) programme is set to expire.—Reuters
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