AMSTERDAM/LONDON: European stocks rose on Tuesday, with Germany’s equity index hitting a record high on optimism around several countries easing economic restrictions, falling unemployment rate in the United Kingdom and strong earnings reports from companies.
The pan-European STOXX 600 index rose 0.2% to end just shy of its record high hit last week, with the travel and leisure index leading gains, while technology stocks rose 0.6%.
The German DAX hit a record high and Italy’s FTSE MIB added 0.1%.
Inflation worries due to gains in commodity prices and supply chain issues have raised fears of central banks dialling back unprecedented fiscal and monetary policy support.
UK stocks cheered data that showed Britain’s unemployment rate fell more than expected to 4.8% in the first quarter when the country was under a tight lockdown, while hiring rose further in April.
As the earnings season draws to a close, analysts expect the profits of STOXX 600 companies to jump 90.2% in the first quarter and 93.4% in the second, as per Refinitiv IBES data.
The world’s biggest maker of hearing aids, Sonova Holding, surged 11.5% after predicting strong growth this year due to a market recovery and new products.
Winston cigarettes maker Imperial Brands rose 1.5% after it reiterated its full-year outlook.
Telecoms took a hit as the UK mobile operator Vodafone fell 8.9% after reporting a 1.2% drop in full-year adjusted earnings, citing the effect of Covid-19 on roaming revenue and handset sales.
French telecoms group Iliad slumped 10.2% after saying it would revise down a key cash flow target as it steps up spending on 5G networks.