European shares put in best day in two months as techs shine

European shares jumped on Friday on strong gains in technology stocks, although the main benchmark logged a steep weekly decline on growing concerns over a slowing global economy and uncertainty around debt ceiling talks in the United States.

The pan-European Stoxx 600 index closed 1.2 per cent higher, logging its strongest one-day gain in nearly two months, bouncing back from an eight-week low hit on Thursday.

Concerns about whether the two sides could reach a deal and avert a US debt default have weighed on markets in recent weeks. The benchmark index clocked its worst weekly drop, of 1.5 per cent, in more than two months.

Latest developments showed the White House and congressional Republicans aim to put the final touches on a deal to raise the debt ceiling for two years, while capping spending on everything but the military and veterans.

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“I feel optimistic that the situation will get resolved, as a US default on debt is simply not an option. That said, because a resolution is the consensus view, a default would trigger a very severe market reaction,” said Seema Shah, chief global strategist at Principal Asset Management.

Dublin

The Iseq All Share index gained 0.7 per cent to 8,609.19, with building materials giant CRH, which generates most of its earnings in the US, advancing 1.1 per cent to €45.20 as sector followers monitored developments in Washington.

Banking stocks were also generally higher, with AIB up 1 per cent at €3.81, while Bank of Ireland advanced 0.2 per cent to €8.82.

Corre Energy, the renewable energy storage developer, rose 0.6 per cent to €3.28 as it reported that its investment phase saw a €10.6 million loss recorded after tax, in line with expectations, for the year to the end of December.

Flutter Entertainment was also a bright spot, gaining 2 per cent to €185.46.

London

UK’s FTSE 100 gained 0.7 per cent, with mining stocks in the lead tracking higher metal prices, while global miner Rio Tinto surged after a brokerage upgrade.

London-listed shares of Rio Tinto jumped 3.5 per cent after Morgan Stanley upgraded its rating to overweight from equal weight.

The broader industrial metals mining sector climbed 2.5 per cent on the day.

AstraZeneca added 1.2 per cent after the drugmaker said a combination of its cancer drugs when added to chemotherapy showed positive results in a late-stage trial in patients with advanced or recurrent endometrial cancer.

Insurer and asset manager M&G added 3.3 per cent after Morgan Stanley raised its price target on the stock.

Tech firm Kin & Carta tumbled 9 per cent on slashing annual revenue expectations.

Europe

Technology, the top sector performer, rallied for a second day on US chipmaker Nvidia’s strong forecast and Marvell Technology’s upbeat revenue guidance on artificial intelligence (AI), with ASML Holding jumping 4.5 per cent to a more than one-year high.

Luxury majors including LVMH, Hermès and Kering continued their rebound, up between 1.4 per cent and 2.4 per cent, after a bruising sell-off earlier this week.

Swedish gaming company Embracer jumped 13 per cent on news of board members buying in total more than 6 million shares.

Faurecia added 7.5 per cent after Jefferies upgraded the French car parts maker to buy.

Casino slumped 6.4 per cent as analysts point to continued uncertainties around its unsecured debt, even as the debt-saddled retailer started court-backed negotiations with creditors.

New York

Wall Street’s main indexes were ahead in early afternoon trade amid progress in negotiations on raising the US debt ceiling, with investors shrugging off data pointing to slightly hotter-than-expected inflation.

Ford Motor gained on signing a deal allowing its customers to access more than 12,000 Tesla superchargers in North America in early 2024. Tesla also rose.

Ulta Beauty dropped after the cosmetics retailer cut its annual operating margin forecast.

Chipmaker Marvell Technology jumped after it forecast its annual AI revenue would double.

Paramount Global advanced after the media conglomerate’s controlling shareholder National Amusements received a $125 million (€116.6 million) investment. – Additional reporting, Reuters