In Monday's trading the key Western European stock indices were rising steadily. By midday they had reached a two-week high, following the US and Asian stock markets. Investors around the world eased fears that decisive moves by major central banks could trigger a recession in the global economy.
The STOXX Europe 600 composite index of Europe's leading companies rose by 0.65% to 415.63 points. Last Friday the index posted its best result in more than three months.
The British FTSE 100 soared by 0.86% to settle at 7268.5 points. The French CAC 40 also rose by 0.86% to 6125.7 points. The German DAX jumped by 1.46% to 13305.86 points.
Risers and fallers
Mining stocks posted the biggest gains on Monday. BHP climbed by 3.5%, Anglo American gained 3.1%, Antofagasta rose by 2.7%, Rio Tinto added 3.2% and Glencore jumped by 3.3%.
The rally of the French automotive sector was also impressive, with Renault up by 2.4% and Michelin up by 1.1%.
Shares in Dutch multinational conglomerate Prosus soared by 13% as the South African parent company reneged on a promise not to sell its shares to China's Tencent. It is expected that the earnings from the securities will be used to support a major share buyback program.
Italian bank Intesa Sanpaolo SpA gained 2.6% on news that the company is launching a €3.4bn buyback program.
The market capitalisation of British consultancy Aquila Services Group Plc increased by 1.9%. The company posted a pre-tax profit of $881,200 for the fiscal year ended March, compared with $276,000 a year earlier.
Meanwhile, Italian insurer Assicurazioni Generali (-2.8%) and gas company Italgas (-2.3%) were among the lowest performing securities traded on European exchanges.
Market conditions
The major upside factor for the European stock market today was investors' anticipation of additional economic growth in China. The day before, coronavirus restrictions were lifted as Shanghai authorities reported no cases of COVID-19 infection for the first time in two months.
The news of a sharp increase in the value of energy companies' stocks proved to be another major reason for the rise in European stock exchanges. Eni, TotalEnergies, Shell and BP were up by 0.38%, 1.48%, 1.77% and 1.4% respectively.
Investors' attention is now focused on the European Central Bank's annual forum in Sintra, Portugal. As part of the three-day event, representatives of the European regulator are scheduled to speak on how to tackle record levels of inflation.
Trading results
European stock indices performed spectacularly on Friday amid investors' expectations of weaker inflation, including due to falling commodity prices. Meanwhile, on Wednesday and Thursday, stock markets in Europe tumbled noticeably on market worries about a global economic recession due to hawkish monetary policies by the world's major central banks.
As a result, the composite index of Europe's leading companies STOXX Europe 600 soared by 2.6% to 412.90 points. During the past week, the index gained 2.4% and closed the week on the positive side for the first time in a month.
Stocks of advertising company Adevinta ASA (+10%), pharmaceuticals company Recordati SPA (+7.6%) and cruise operator Carnival (+8.7%) were the top performers in the STOXX Europe 600 index.
The British FTSE 100 gained 2.7%. The French CAC 40 added 3.2%, while the German DAX rose by 1.6%.
The stock price of Spanish technology giant Indra Sistemas SA plummeted by 15%. Previously, the company's management announced the resignation of CFO Javier Lazaro. Borja Garcia-Alarcon Altamirano will become the new CFO.
The market capitalisation of Europe's largest tour operator, TUI AG, sank by 3.9%. The previous day the company's management announced the resignation of TUI AG CEO Friedrich Joussen at the beginning of autumn. CFO Sebastian Ebel will become the company's new CEO.
German online retailer Zalando SE dropped 1.6% on weaker-than-expected second quarter results. In addition, the management of Zalando revised down its annual forecast and expects the company's revenue in 2022 to grow by only 3%, rather than the 12-19% previously expected.
However, domestic statistics from Eurozone member states proved to be an important upward factor for the European indicators on Friday. Thus, on Friday morning it became known that in June the German business confidence index (indicator of business climate) for the economy of Germany fell to 92,3 points from 93 points in May. Analysts had forecast an average drop to 92.9.
UK retail sales fell 0.5% in May month-on-month, reversing a rise in April. The print beat the market estimate of a 0.7% decline.
