European stock markets closed on a positive note on Friday, buoyed by encouraging U.S. employment data. While geopolitical tensions lingered, they did not deter investors from acquiring key stocks. In addition to the U.S. job market insights and geopolitical updates, investors absorbed an array of economic data from Europe.
The pan-European Stoxx 600 index rose by 0.44%. Notably, Germany's DAX and France's CAC 40 increased by 0.55% and 0.85%, respectively. Meanwhile, the U.K.'s FTSE 100 experienced a marginal dip of 0.02%, and Switzerland's SMI concluded with a 0.13% decline.
In other European markets, indices in Austria, Belgium, Finland, Greece, Iceland, the Netherlands, Norway, Poland, Russia, Spain, Sweden, and Türkiye closed with gains. Portugal saw marginal gains, whereas Denmark's performance was weaker.
In the U.K. market, notable companies such as NatWest Group, Schroders, Standard Chartered, Croda International, and Barclays recorded increases ranging from 3% to 4%. Meanwhile, EasyJet, DCC, Lloyds Banking Group, BP, Centrica, M&G, IAG, Mondi, BT Group, Antofagasta, Beazley, IHG, WPP, Weir Group, and Fresnillo saw upticks between 1% and 2.7%.
Conversely, Spirax Group, SSE, JD Sports Fashion, Experian, AstraZeneca, Severn Trent, Segro, National Grid, Relx, British Land, Convatec Group, and Halma faced declines of 1% to 3.4%.
Over in Germany, key players like Siemens Energy, Volkswagen, Deutsche Bank, Continental, Infineon, Siemens, Commerzbank, BMW, BASF, Daimler Truck Holding, Porsche, Mercedes-Benz, and Hannover Rueck advanced by 1% to 3.5%. In contrast, RWE, Deutsche Boerse, Merck, Siemens Healthineers, Symrise, E.ON, and Sartorius ended with significant to moderate losses.
France's market saw Accor rally nearly 3.5%, with Renault, Teleperformance, Vinci, Societe Generale, and Veolia advancing between 2% and 3%. Companies such as Bouygues, Saint-Gobain, Stellantis, TotalEnergies, Edenred, Publicis Groupe, BNP Paribas, Michelin, Sanofi, AXA, Essilor, and Credit Agricole saw hikes between 1% and 2%.
Shipping giants Moeller-Maersk and Hapag Lloyd faced considerable drops of 5.6% and 16%, respectively, attributed to escalating tensions in the Middle East. Meanwhile, Denmark's DSV soared by 6.7% following its $5.5 billion share issuance to partially fund the acquisition of Schenker.
Italian energy leader Eni S.p.A. saw an increase of approximately 1.5% after securing a commitment from the U.K. Government for funding the granting of an economic license for the Liverpool Bay CO2 transport and storage (T&S) project.
In economic developments, Germany's construction sector contracted at the slowest rate in 16 months in September, as indicated by S&P Global's survey. The construction Purchasing Managers' Index improved to 41.7, up from 38.9 in the prior month, marking the highest level since May 2023, though still below the 50.0 threshold indicating contraction.
The UK's construction activity achieved its fastest expansion in nearly two-and-a-half years in September, according to S&P Global, spurred by improved output and new order growth amidst declining interest rates. The construction Purchasing Managers' Index increased to 57.2 from 53.6 in August, surpassing the anticipated rise to 53.1, remaining above the neutral 50.0 mark for the seventh consecutive month and indicating the steepest growth rate in 29 months.
Data from INSEE indicated a rebound in France's industrial production in August, primarily driven by robust advances in transport equipment output. Industrial output grew by 1.4% on a monthly basis, outperforming the 0.2% increase observed in July, and surpassing the predicted 0.3% growth. Manufacturing output surged by 1.6%, contrasting with the previous month's 0.2% decline.
In the UK, new car registrations saw an increase in September during the '74' plate change month, fueled by significant electric vehicle discounts that bolstered demand, as reported by the Society of Motor Manufacturers and Traders. New car sales rose by 1% to 275,239 units, marking the strongest performance since 2020 and making September the second-highest month for new car registrations, after March.
According to the U.S. Labor Department, non-farm payroll employment jumped by 254,000 jobs in September, following an upward revision to 159,000 jobs in August. Economists had projected a 140,000 job increase, slightly higher than the initially reported addition of 142,000 jobs in the previous month. The report also noted a slight decline in the unemployment rate, dipping to 4.1% from 4.2% in August, counter to economists' expectations that it would remain unchanged.
