Europe close: Shares shrug off lockdown worries to hit fresh highs
By Frank Prenesti
Date: Monday 15 Nov 2021
(Sharecast News) - European shares closed at record highs on Monday, despite the prospect of new lockdown fears across the Continent.
The pan-European Stoxx 600 index finished 0.35% higher to hit a new record of 483.43 points. Germany's DAX also to reach record highs, while France's CAC 40 outperformed the broader market and powered beyond the 7,100 mark.
Investor sentiment at the start of the session was lifted by an unexpected rise in China's industrial output and retail sales last month, although weakness in the property sector continued to weigh on the wider economy.
According to the National Bureau of Statistics, industrial output rose 3.5% year-on-year in October, up on both September's 3.1% rise and analyst expectations for growth of 3.0%. It remains the second lowest reading so far this year, however.
Retail sales rose 4.9%, up on September's print of 4.4% and significantly ahead of forecasts for 3.5%.
Attention will now focus on retail sales figures in the US and UK this week as the third quarter earnings season begins to wind down.
"The market recovery has well and truly stalled in Europe while Asia is still struggling to get much uplift and the US is failing to build on record highs. In many ways, I'm encouraged by the resilience we're seeing in the markets which are again factoring in higher inflation and earlier rate hikes. But then I wonder what will be the catalyst for the rally to continue," said Oanda analyst Craig Erlam.
"There's a long list of reasons to be concerned right now but with earnings season basically in the rearview mirror, the bullish list is looking a little light. Of course, Covid restrictions this winter could be relatively light touch as vaccinations keep hospitalisations and fatalities low which would be a big plus for companies and economies, and support equity markets. But that will only become clear over time."
Elsewhere, Austria became the first European country to reinstate a fresh lockdown, placing millions of unvaccinated people under restrictions amid record-level infection rates.
In equity news, shares in Philips, which is recalling ventilators due to use of parts containing a potentially hazardous foam, plunged by more than 10.6% after the medical equipment maker announced it was in discussions with US regulators following a new inspection of one of its facilities.
Miners were dragged lower on weaker iron ore and metal prices with BHP, Glencore, Rio Tinto and Anglo American all down as a result.
Avast surged after NortonLifeLock satisfied the US antitrust condition for its £6.2bn acquisition of the London-listed cybersecurity firm.
Airbus climbed after it won a multi-billion-dollar order for 255 single-aisle A321neo passenger jets from private-equity firm Indigo Partners' portfolio airlines and a separate order by Wizz Air for 102 of the aircraft.
Royal Dutch Shell gained after saying it would simplify its business and move its head office to the UK from the Netherlands.
"While the government in the Netherlands have expressed surprise at today's decision, it probably shouldn't be too much of a shock given the recent decision by a Dutch court to rule that the company must reduce its carbon emissions by 45% by the end of the decade," said CMC Markets analyst Michael Hewson.
Spanish Bank BBVA fell on its offer to buy the rest of Garanti BBVA for up to €2.25bn.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN