European stocks end higher on tech boost, stimulus hopes

European stocks closed higher on Wednesday as news of additional stimulus in Germany and anticipated economic recovery measures in France overcame concerns about rising Covid-19 cases across the continent.

The pan-European Stoxx 600 index added 0.9 per cent, with German stocks up 1 per cent and France’s CAC 40 0.8 per cent higher.

Having led the recovery from March’s pandemic-driven lows, technology shares were the day’s best performers, mirroring gains on Wall Street.

Germany’s coalition parties agreed to extend measures to cushion the economic effects of the coronavirus crisis at a cost of up to €10 billion, while France is set to present its economic recovery plan on September 3rd.

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DUBLIN

The Iseq closed up 1.7 per cent at 6,579, mirroring positive trends elsewhere. A more upbeat economic outlook usually translates into an uptick for financials and both AIB and Bank of Ireland traded up 3.9 per cent and 1.1 per cent on the day.

Ryanair was up 1.1 per cent at €12.37 as investors bet European airlines with more of a focus on domestic markets will recover better.

Co Cavan-based insulation and building materials manufacturer Kingspan was up 1.7 per cent to €73.30. Kingspan stock has traded strongly since its chief executive said the company saw significant pent up demand after the Covid-19 lockdowns.

Swiss-Irish food group Aryzta was also up 2 per cent to 55 cent ahead of next month's showdown with dissident shareholders and amid speculation it might be taken over.

PaddyPower Betfair owner Flutter was up again, this time by nearly 3 per cent to €140.

LONDON

A surge in Provident Financial's shares boosted the British mid-cap FTSE 250 on Wednesday, while investor attention turned to an annual central bankers' conference later in the week.

Provident jumped 20.8 per cent to its highest in five months despite suspending dividend payments, with analysts saying the doorstep lender's first-half loss and bad loan provisions were less than feared.

The domestically-focussed FTSE 250 was up 0.9 per cent after sliding in the previous session following an unexpected fall in domestic retail sales.

The export-laden FTSE 100 closed up just 0.1 per cent, struggling to build on a strong start to the week as more signs of a sluggish economic rebound overshadowed optimism around Covid-19 vaccines and US-China trade.

UK equity benchmarks have lagged the recovery in their European and US peers since April and are still down about 20 per cent on the year. That compares with a 6.6 per cent rise for the S&P 500 powered by historic stimulus and a rally in technology stocks.

All eyes are now on US Federal Reserve chair Jerome Powell's address at the virtual Jackson Hole Symposium on Thursday, where he is expected to provide an update on the US central bank's future monetary policy approach.

EUROPE

Heavyweight German enterprise software maker SAP rose 2.2 per cent after US peer Salesforce. com raised its 2021 revenue forecast.

Swedish radiation therapy equipment maker Elekta topped the Stoxx 600 after posting a bigger-than-expected first-quarter profit.

HiQ International soared nearly 26 per cent after private equity firm Triton announced a 3.9 billion crown ($444.9 million) cash bid for the Swedish IT consultancy firm.

Telecom Italia rose 5.1 per cent after a local newspaper reported the Italian government had given approval to US investment firm KKR to buy a minority stake in its secondary grid.

Ambu, which makes diagnostic and life-support devices for hospitals, slumped 13.4 per cent after it cut its full-year earnings forecast.

NEW YORK

The S&P 500 and the Nasdaq hit record highs on Wednesday as investors bought into technology stocks that have thrived during the Covid-19 pandemic following the upbeat quarterly results from Salesforce and HP Enterprise.

Salesforce, which is set to enter the blue-chip Dow index next week, surged 27.3 per cent as it raised its annual revenue forecast due to high demand for its online business software.

Hewlett Packard Enterprise added 6.2 per cent as its full-year profit outlook came ahead of market expectations, and income-tax filing software firm Intuit advanced 1.1 per cent after it reported a jump in quarterly revenue.

The tech sector climbed 1.5 per cent , but seven of the 11 major S&P sectors eased. The MSCI world equity index hit an all-time high. – Additional reporting by Reuters