Europe close: Politics and Geopolitics in focus
By Alexander Bueso
Date: Thursday 13 Feb 2025
(Sharecast News) - European stock markets continued to grind higher, thanks to upbeat results from drinks giant Heineken, despite the release of hotter-than-expected US inflation data.
Worth noting, Spanish daily Expansión noted strong buying of gold by German investors ahead of the country's elections.
And after the close of trading, Trump announced that the US and Russia would kick off peace talks.
Linked to the above, analysts at Barclays were reportedly telling clients that the risk premium associated with the war in Ukraine had taken 10% off European markets.
The pan-regional Stoxx 600 was up 0.11% to 547.78 and Germany's Dax by 0.50% to 22,148.03.
Both benchmarks notched up fresh record highs during Wednesday's session.
Spain's Ibex 35 outperformed, rising by 1.07% to 12,911.50, whilst Italy's FTSE Mib was the odd man out, drifting lower by 0.14% to 37,531.19.
All the main European equity benchmarks were at so-called 'overbought' levels.
US consumer price inflation came in clearly ahead of economists' forecasts due to increases in food, gasoline and shelter costs.
Some economists in the City also linked a little bit of the gain to the revised seasonal adjustment factors.
Holger Schmieding at Berenberg welcomed Washington's initiative on Ukraine, saying that a "serious initiative to stop the war is most welcome" and could be "a major positive" for Europe.
Nonetheless, in his view two things were needed for success, the "US (and Europe) needed to exert enough pressure on the Kremlin so that Moscow negotiated in earnest" and the results of the talks had to be "genuinely acceptable" to Kyiv.
For his part, Thomas Graham, a Distinguished Fellow at the US Council on Foreign Relations and former Kissinger Associates Managing Director said: "It's quite clear that the United States is not going to war with Russia to defend Ukraine, and that has been true for 35 years or longer," Bloomberg reported.
"It will be critical that there be a Russia-US channel."
In equity news, Heineken shares surged 14% after the brewer reported better-than-expected operating profits and unveiled a £1.5bn share buyback program along with a higher dividend. The news lifted rivals AB InBev and Carlsberg.
French luxury goods firm Kering was up 7% by mid-morning, as UBS raised its target price on the stock after the company on Tuesday reported better-than-expected fourth-quarter sales.
Norwegian financial services company Storebrand slumped 9%after fourth-quarter earnings missed estimates.
ABN Amro jumped 8% after the bank's fourth-quarter results beat expectations.
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