European stocks higher as euro zone data offsets HSBC warning
A surge in German stocks lifted the broader European market on Monday after the country reported an expansion in monthly factory activity for the first time since 2018, but a warning from Europe’s biggest lender HSBC kept gains in check.
Erasing early losses, the panEuropean STOXX 600 index climbed 0.5%, with miners, technology and media firms leading the gains. The exporter-heavy German bourse, already benefitting from upbeat Chinese factory data, rose 1.3% after IHS Markit’s final Purchasing Managers’ Index (PMI) for factories rose to 51 in July, rising above the 50 mark that separates growth from contraction. Broadly, factory activity across the euro zone expanded for the first time since early 2019.
The numbers helped ease early gloom following concerns over progress on the U.S. coronavirus relief package and a further tightening of restrictions in Europe as COVID-19 cases rose.
Spanish stocks were down 0.5% as the country on Friday saw the biggest jump in coronavirus cases since a national lockdown was lifted in June, while data showed international tourist arrivals to the country fell 98% year on year in June.
Travel & leisure stocks also dropped 0.4%, with Carnival Plc sliding 3.5% after revealing plans to cancel short trips on AIDA Cruises while it still waits for approvals from Italy. British engineer Senior Plc, which counts planemaker Boeing and heavy equipment maker Caterpillar as some of its biggest customers, tumbled 12.3% as it shelved its interim dividend after swinging to a first-half loss.
Banking stocks took a hit as HSBC dropped 3.7% after its halfyearly profits more than halved and the lender warned its bad debt charges could blow past a previous estimate to $13 billion this year.
France’s Societe Generale declined 2.0% as it reported a 1.26 billion euro ($1.48 billion) quarterly loss after booking a writedown on the value of its trading business.
This article was compiled by BOV Asset Management Limited, a member of the BOV Group. BOV Asset Management,TG Complex, Suite 2, Level 3, Brewery Str., Mriehel BKR 3000. Email: infoassetmanagement@bov.com Internet address: www.bovassetmanagement.com. BOV Asset Management is licensed by the MFSA.