European stocks on Friday posted their best weekly performance since early April, aided by strong gains in Paris, against a backdrop of hope among investors that central banks would support global growth with more accommodative policies.
The Deutsche Bundesbank slashed its growth projections for Germany and eurozone money markets now price in a 60 percent chance of the European Central Bank cutting interest rates by 10 basis points by year-end, while US job growth slowed sharply last month, feeding expectations of lower US interest rates this year.
The pan-European STOXX 600 on Friday gained 3.46 points, or 0.9 percent, to 377.48, jumping 2.3 percent from a close of 369.06 on May 31.
Paris’ CAC 40 on Friday climbed 85.63 points, or 1.6 percent, to 5,364.05, a surge of 3 percent from 5,207.63 a week earlier.
Germany’s DAX on Friday rose 92.24 points, or 0.8 percent, to 12,045.38, gaining 2.7 percent from a close of 11,726.84 on May 31.
London’s FTSE 100 on Friday gained 72.09 points, or 1 percent, to close at 7,331.94, an increase of 2.4 percent from 7,161.71 a week earlier.
“Investors continue to pile into equities, with the jobs report and subsequent stock rally capping a very good week for equity markets,” IG Group PLC chief market analyst Chris Beauchamp wrote in a note.
Sanofi SA tacked on 4.4 percent to prop up the French index and European healthcare stocks, on news that it has poached Paul Hudson from Novartis International AG to become its new chief executive later this year.
The STOXX 600’s top performer was Dutch insurer ASR Nederland with a 5.8 percent rise, after rival Vivat, for which ASR previously made an offer, agreed to be bought by private European life insurer Athora.
Technology shares, broadly sensitive to trade war ructions, starred with a 2 percent gain.
Chinese President Xi Jinping (習近平) on Friday called US President Donald Trump his friend and said that he believed Washington was not interested in rupturing economic ties with Beijing.
The chemicals sector was among Europe’s top performers, rising 1.1 percent. Belgian chemical and materials maker Solvay SA gained 2.3 percent, aided by UBS Group AG upgrading its rating on the stock and boosting its target price.
While higher Brent crude futures fuel energy shares’ 1.2 percent rise, Polskie Gornictwo Naftowe i Gazownictwo SA led the sector with a 3.5 percent gain. A unit of the Polish firm bought a stake in the Norwegian King Lear deposit from Total E&P Norge AS.
Financial services rose 0.8 percent, with the sector’s gains led by Exor NV, which added 1.6 percent. The Milan, Italy-listed firm is the top shareholder in Fiat Chrysler Automobiles NV, which pulled away from an offer to merge with Groupe Renault earlier this week.
Automakers and their suppliers gained 0.1 percent, as a 4.9 percent fall in German automotive parts maker Hella KGaA Hueck & Co following a rating downgrade by brokerage ODDO BHF weighed.
Real-estate stocks dipped 0.6 percent, making them the STOXX 600’s only losing sub-sector.
Deutsche Wohnen SE slid 8.5 percent after Morgan Stanley downgraded its rating on the German property group from “overweight” to “equal weight.”
The bank cited the risk of rising political involvement in the German residential market. The Berlin Senate earlier this week proposed imposing a five-year rent freeze from January next year.
Additional reporting by staff writer
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