PARIS: Europe’s STOXX 600 ended higher on Friday, as tech stocks made a strong comeback at the end of a bumpy week, while the European Central Bank’s rate cut and a flurry of corporate earnings helped the index deliver a second straight week of gains.
The STOXX 600 closed up 0.2% as the tech sector led gains with a 2% jump.
That cut the weekly loss for the tech index to 6%, but it remained the worst-performing sector this week after ASML’s weak 2025 sales forecast sparked a rout in chip stocks globally.
The computer chip equipment maker’s shares were up 1% on Friday, while chip stocks Soitec SA and BE Semiconductor Industries were up 5.6% and 2.8%, respectively.
Basic resources shares climbed 1.4%, boosted by strong copper prices.
The luxury stocks index rose 1.1% after a sell-off earlier this week following LVMH’s weak third-quarter sales.
With LVMH, other luxury giants such as Gucci-owner Kering and Hermes rose 3.5% and 1% respectively, aiding France’s main CAC 40 index that gained 0.4%.
Brunello Cucinelli rose 2.6% following the Italian luxury group’s strong nine-month revenue performance.
However, brokerage Goldman Sachs slashed its 2024 earnings growth forecast for Europe’s STOXX 600 index to 2% from 6%, citing risks from rising corporate taxes and potential trade tariffs.
On the policy front, the ECB trimmed its interest rates to 3.25% on Thursday. Sources told Reuters a fourth cut in December was likely unless key data turned south by then.
The STOXX index hit record highs multiple times earlier this year, but has struggled to make any gains since mid-May as sluggish economic growth and weak Chinese demand held back investors, despite European stocks trading at cheaper valuations than their US peers.
“The particular point of vulnerability for Europe, is that the economic downside looks to be much riskier than in the US, so trend growth is slower and you’re much more vulnerable to downside risks and shocks,” said Daniel Murray, deputy CIO & global head of research at EFGAM.
Elisa fell 4.7% after the Finnish telecom company’s third-quarter revenue missed expectations, while Swedish medical equipment maker Getinge dropped 5% after third-quarter core earnings missed forecasts.
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