European stocks saw an uptick on Thursday as a robust set of earnings from various companies and dovish remarks by Bank of England Governor Andrew Bailey helped counterbalance the region’s lackluster business activity figures.
Governor Bailey conveyed that the UK's inflation is declining more swiftly than anticipated by central bankers, fueling speculation for another rate cut on November 7. “Disinflation is occurring more rapidly than we expected, although we face genuine uncertainties regarding potential structural shifts in the economy," he stated at an event held by the Institute of International Finance in Washington, DC.
Simultaneously, sources reported by Reuters suggested that European Central Bank policymakers are deliberating on whether to lower rates beneath the neutral threshold to stimulate economic growth.
Regarding economic updates, S&P Global's flash survey indicated that Eurozone private sector activity witnessed a moderate contraction in October, driven by a continued downturn in manufacturing. The HCOB flash composite output index inched up slightly to 49.7 in October, from 49.6 in the previous month.
Conversely, UK private sector activity expanded at its most sluggish rate in nearly a year in October, hindered by weak demand under the shadow of heightened economic uncertainty, as divulged by flash survey results from S&P Global. The flash composite output index slipped to 51.7 in October, down from 52.6 in September.
The pan-European STOXX 600 advanced by 0.6 percent to 521.86, bouncing back from a 0.3 percent decline on Wednesday. Germany's DAX increased by 0.7 percent, France's CAC 40 also grew by 0.7 percent, and the UK's FTSE 100 surged 0.8 percent.
In corporate highlights, Indivior soared by 9 percent after the British addiction treatment specialist showcased a robust third-quarter performance. Conversely, fund manager Abrdn tumbled by 8 percent as it reported more significant outflows of client funds than anticipated in the third quarter.
Essentra rose by about 1 percent, signaling that its forecasted FY24 adjusted operating profits would align with market expectations. GSK also climbed by 1 percent upon announcing promising new data for its RSV vaccine, Arexvy, in younger adults.
Bunzl, involved in distribution and outsourcing, fell by 2.4 percent, despite reaffirming its full-year guidance. Meanwhile, Barclays soared by nearly 4 percent after its third-quarter profit surpassed expectations. Anglo American, the global mining giant, jumped 4.1 percent following an increase in its platinum and nickel production projections.
Unilever, the consumer goods titan, gained 3.9 percent, reporting quarterly sales that slightly exceeded expectations. Hermes International, the luxury Birkin bag maker, rose by 1.8 percent in Paris following an 11.3 percent increase in third-quarter sales. Its counterpart, Kering, advanced by 1.1 percent on recording higher third-quarter sales.
Orange gained 1.7 percent, thanks to reporting a revenue of 9.995 billion euros for the third quarter, marking a 1.6 percent year-on-year increase, primarily driven by growth in retail services. Renault surged by 6.5 percent as it posted an unexpected rise in quarterly revenues.
Sodexo, the catering company, advanced 5.2 percent after announcing a greater than expected sales growth for the year ending August 3. Danone, the consumer goods group, increased by 2.3 percent as its Q3 organic revenue growth outstripped market projections.
Michelin, the tyre manufacturer, dropped by 7 percent after scaling back its annual sales volume forecast. Nivea maker Beiersdorf gained 3.4 percent, having reported a rise in group sales for the first nine months of 2024.
Finally, Symrise fell by 2.2 percent after reporting third-quarter sales figures that, in the reporting currency, slightly missed projections.
