European stocks rise as markets weigh corporate earnings

But investors eye threat to economic recovery from delta variant

Photograph: iStock

Photograph: iStock

 

European stocks climbed with US equity futures on Thursday as investors balanced strong corporate earnings against the threat to the economic recovery from the spread of the delta virus variant.

The Stoxx 600 Index drifted higher, with Rolls-Royce Holdings gaining after announcing a surprise first-half profit and Siemens up after the German engineering company posted better-than-expected third-quarter results.

In Asia, equities edged up in Japan but slipped in Hong Kong and China, where Beijing’s regulatory curbs continue to dominate the agenda. Contracts on the S&P 500 Index rose 0.2 per cent.

Treasuries were little changed with the dollar, while oil was steady after several days of losses on the risks to demand posed by the delta variant, especially in the key market of China.

With stocks at or near record highs, investors are keeping an eye on the fast-spreading delta strain of the coronavirus, which is prompting new mobility curbs and a rally in sovereign debt. Also on the agenda are prospects of a pullback in stimulus after vice chairman Richard Clarida said on Wednesday the Fed is on track for a liftoff in interest rates in 2023.

The US job market remains a key window onto the outlook, with the latest economic data showing a much softer-than-expected ADP employment report but a record expansion for US service industries. American jobs numbers are due Friday. – Bloomberg