European stocks rose to fresh six-week highs on Friday, helped by an easing of fears over US tariffs and some solid company results.
Shares in consumer goods company Reckitt Benckiser Group PLC, supermarket retailer Carrefour SA, construction group Vinci SA, BT Group and bank BBVA SA rose following well-received results, lifting the pan-European STOXX 600 benchmark, closing 0.6 percent higher.
“On average, earnings updates are quite good,” Geneva, Switzerland-based Prime Partners Group fund manager Jerome Schupp said. “The message about the second half is also reassuring given the uncertainties regarding trade wars.”
European second-quarter earnings per share growth has accelerated to six percent from 0 percent in the first, a result they said was good given the deterioration in euro area growth momentum, Deutsche Bank AG said.
Hopes of a breakthrough in US-EU trade talks on Thursday lifted the STOXX 600 to its highest level since the middle of last month as automakers, which rely on exports for growth, rose sharply.
The index ended the week up 1.7 percent.
However, investors kept a degree of caution.
The US Department of Commerce is to continue its probe into whether car imports pose a national security risk despite ongoing trade talks with the EU, but US President Donald Trump asked that no action be taken at this time, US Secretary of Commerce Wilbur Ross said on Thursday.
Automakers declined 0.2 percent on the STOXX 600 on Friday.
Renault SA rose nearly 2 percent after a volatile start as the French automaker achieved record profitability in the first half of this year as emerging market sales surged.
“Results came in line with a modest headline beat and better net liquidity, but details of margin development, and capital intensity are mixed and likely to keep pressure on margins,” Jefferies LLC analysts said in a note.
Shares in German automakers BMW AG and Daimler AG, which are heavily exposed to the US market, slipped slightly.
Mining company BHP Billiton Ltd rose 3 percent after BP PLC agreed to buy its US shale oil and gas assets for US$10.5 billion. BP shares reversed earlier losses to end 0.5 percent higher.
“The shale deal presents a promising opportunity for BP to reverse many years of underinvestment,” Accendo Markets Artjom analyst Artjom Hatsaturjants said.
“Still, it comes at a price of a short-term hit to shareholder value and would divide those investors looking for a quick profit from rising oil prices and those who see a long-term opportunity in holding energy stocks,” he added.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by