European stocks capped the best quarterly performance in a year, with investors now expecting the rally to broaden beyond the biggest companies in the region on optimism about interest rate cuts and economic growth.
Europe’s Stoxx 600 was up 0.2 per cent at the close in London ahead of the Easter holiday, bringing quarterly gains to about 7 per cent. Thursday’s gains were driven by retail and media sectors.
Among individual movers Soitec slumped after the company’s outlook came in well below analysts’ expectations. Spirent Communications jumped after Keysight Technologies made an offer for the struggling telecom network testing company, exceeding an earlier bid for the UK company from Viavi Solutions.
“The real catalyst for the second quarter will be for inflation to continue to go down and for central banks to actually cut rates in June, because if that doesn’t happen that would be quite negative,” said Arnaud Cayla, deputy chief executive at Cholet Dupont Asset Management. “Trading is based on a perfect scenario so there’s no room for error,” he said.
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Dublin
Much of the wider stock market rally in Europe was driven by banks and Ireland was no exception with AIB and Bank of Ireland up 2.7 per cent and 4.6 per cent respectively.
The State’s largest hotel group Dalata was also buoyant with the stock rising 2.3 per cent to €4.50. Kingspan traded flat after the company confirmed on Thursday it has ended up with 35.7 per cent of a Swedish maker of building waterproofing products after the company’s board and most of its shareholders rejected the Cavan group’s takeover offer.
The Irish insulation giant announced last October the equivalent of a €229 million mandatory cash offer for Nordic Waterproofing after its stake in the company had crossed the key 30 per cent threshold. Smurfit Kappa and Ryanair were marginally up.
Europe
Europe’s Stoxx 600 closed at a record high on Thursday, finishing its second straight quarter in gains, with retailer JD Sports notching its strongest day in over four years after reiterating its annual profit forecast.
The pan-European STOXX 600 ended 0.2 per cent up, closing a week that was marked by four rangebound sessions ahead of a holiday extended weekend. The benchmark index finished its second straight quarter of gains with a 7 per cent rise, fuelled by optimism around imminent interest rate cuts and a rally in technology stocks on the back of artificial intelligence fervour.
Among other stocks, Millicom rose 3.5 per cent after JP Morgan upgraded the Swedish telecom group to “overweight” from “neutral”. Casino slumped 63.4 per cent after the French food retailer completed its financial restructuring and said a new leadership team formed around Czech billionaire Daniel Kretinsky was taking control.
London
The UK’s top stock market index has hopped closer to an all-time high as it closed the quarter with a pre-Easter boost. The FTSE 100 hit a new high of more than a year on Thursday amid a slight upgrade to UK economic data.
It closed 20.64 points higher, or 0.26 per cent, at 7,952.62, edging nearer to the 8,000 mark which it last surpassed in February 2023. The blue-chip index was lifted higher by a surge in the share price of JD Sports Fashion, which provided an update to shareholders revealing rising sales and hundreds of new store openings. The company said trading was tough at the moment, but that it expects conditions to improve later this year. Investors appeared to be pleased with the update from the sportswear giant and its shares soared by more than 17 per cent.
Meanwhile, revised official figures showed that the UK economy contracted by slightly less than expected during the second half of last year.
New York
Wall Street’s main stock indexes also showed minimal change and markets broadly were largely rangebound ahead of Friday’s much-anticipated US personal consumption expenditures (PCE) price index data, a closely watched inflation measure. Few markets will be open to assess and respond to the fresh data, however, given the long Easter weekend in many countries.
“People are probably a little cautious about positioning ahead of PCE,” said Sameer Samana, senior global market strategist at the Wells Fargo Investment Institute. “For a lot of people today will be the last day of the week, they are probably squaring positions for the quarter, for the month.” – Additional reporting by Bloomberg/Reuters
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