European markets on the rise following two-day drop
Norsk Hydro rose 1.6% as US peer Alcoa posted higher-than-projected quarterly profit
European stocks advanced, after the region’s equities posted their first back-to-back losses in more than three weeks. Photo: Bloomberg
European stocks advanced, after the region’s equities posted their first back-to-back losses in more than three weeks. US index futures were little changed, while Asian shares outside Japan rose.
Wirecard jumped 6.7 per cent as it proposed a dividend and Hauck and Aufhaeuser Privatbankiers upgraded the stock to buy as it confirmed its 2014 earnings outlook.
Indesit gained 1.1 per cent after Il Sole 24 Ore reported Whirlpool may offer to buy the company.
The Stoxx Europe 600 Index added 0.6 percent to 335.85 at 10.58 am in London.
The gauge has fallen 1 per cent from a six- year high reached on April 4 as investors sold the region’s best-performing stocks and tension escalated between the US and Russia over the future of Ukraine.
The equity benchmark gauge has advanced 2.3 per cent in 2014. Standard and Poor’s 500 Index futures rose 0.1 per cent today, while the MSCI Asia Pacific excluding Japan Index rallied 0.9 per cent.
“We’re at a key point in the market when you need to assess whether you are paying what you should be paying,” Francois Savary, who helps oversee about $9.6 billion as chief investment officer at Reyl and Cie, said by phone from Geneva. “Companies’ earnings guidance, starting in the US, will be a good indicator of this.
Valuations are fair, and there’s still liquidity waiting to be invested. Sentiment is still high but you need earnings and economic growth to accelerate.”
Alcoa posted first-quarter profit excluding restructuring costs and other one-time items of 9 cents a share, beating the 5-cent average analyst estimate. Aluminum climbed on the London Metal Exchange as the US producer of the metal forecast a global supply deficit this year of 730,000 metric tons, compared with the January estimate of a 106,000-ton surplus.
A gauge of European carmakers posted the biggest gain of the 19 industry groups on the Stoxx 600.
Daimler rose 0.9 per cent to €70.55. Chief executive officer Dieter Zetsche said his expansion of Mercedes-Benz model offerings will enable the third-largest maker of luxury cars to beat competitors’ sales growth and raise operating profit significantly in 2014.
Volkswagen climbed 2.9 per cent to €195.45 and Porsche Automobil added 4.2 per cent to €78.77. Sanford C. Bernstein raised its ratings on both stocks to outperform, similar to buy, from market perform, citing the potential for a recovery in Europe and cheaper valuation multiples relative to rival Bayerische Motoren Werke.