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Market Analysis

China rally brings the STOXX 600 very near to all-time highs
Amos Simanungkalit · 12.8K Views

15

European shares surged on Thursday, lifted by optimism from Asia following reports that China is contemplating capital injections into its major banks, while investors looked ahead to comments from the European Central Bank (ECB) president.

By 0710 GMT, the pan-European STOXX 600 index had risen 1% to 524.56 points, nearing its all-time high of 526.66.

Technology and basic resources sectors were the main drivers, with both climbing over 3%. 

Conversely, oil stocks were the largest laggards, declining 2.8% as oil prices dropped amid news that Saudi Arabia, the world's top oil exporter, had abandoned its crude price target. 

Separately, reports suggested that China may inject up to 1 trillion yuan ($142.39 billion) into its leading banks to enhance their capacity, aiming to bolster the country's struggling economy.

Chinese authorities also vowed to stimulate growth with aggressive interest rate cuts.

Luxury stocks further buoyed the index, with LVMH and Hermes advancing more than 4.3% each.

Attention later in the day is set to shift to ECB president Christine Lagarde's remarks, scheduled for 1330 GMT, alongside speeches from other ECB board members.

Meanwhile, the Swiss National Bank is expected to reduce its interest rate by 25 basis points.

Shares of H&M (ST) tumbled 7.7% after the world's second-largest publicly traded fashion retailer announced it no longer anticipated meeting its full-year earnings margin target, citing a lower-than-expected operating profit for the third quarter.

 

 

 

 

 

 

Paraphrasing text from "Reuters" all rights reserved by the original author.

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