European shares gain, French stocks at highs as investors focus on earnings

FRANKFURT: European shares closed slightly higher on Tuesday, following a 1 percent jump in the previous session, as investors assessed mixed corporate earnings, while French stocks closed at a record high.

The continent-wide STOXX 600 index ended 0.2 percent higher and most other major regional indexes were also in positive territory. Spain’s was down 0.4 percent. At the top of the STOXX 600, vouchers and benefit cards provider Edenred climbed 19.6 percent after it reported third-quarter sales that were above expectations.

Other French stocks including luxury groups LVMH and Hermes helped to boost the broader European index by 0.7 percent. Industrial stocks gained 0.7 percent, with Airbus up 1.8 percent and Safran up 1.7 percent.

French stocks have been on the rise since last week when Prime Minister Sebastien Lecornu survived two no-confidence votes. European real estate stocks added 1.3 percent. Segro advanced 2.9 percent after the warehousing group reported strong third-quarter rent signings.

As per LSEG I/B/E/S data, 22 companies on the STOXX 600 have reported earnings so far for the third quarter, with 50 percent of them beating analysts’ estimates.

Mining stocks were at the bottom of the STOXX 600, tracking a retreat in prices of gold, silver and copper.

The STOXX 600 index added about 1 percent in the previous session as concerns surrounding the US banking sector and US-China trade tensions calmed. “Markets have once again shrugged off a potential risk-off event... Friday’s concern over private credit exposure among the US banks seems to be behind us,” said Mohit Kumar, economist at Jefferies.

“Our view remains that the macro picture is supportive of risky assets and any dips will be bought.” Meanwhile, leaders of European nations, including Britain, France, Germany, Ukraine, and the European Union issued a joint statement setting out support for Ukraine and Trump’s efforts to end the fighting there.

Investor sentiment was also buoyed after Trump said on Monday he expected to reach a fair trade deal with his Chinese counterpart. Among other stocks, HSBC rose 1.6 percent after it appointed former NatWest executive David Lindberg as CEO of its UK business.