European equities concluded the trading session on a positive note on Friday, driven by anticipations of potential interest rate cuts by central banks in response to weaker economic indicators, aimed at invigorating economic growth.
Investors were not only processing regional economic updates but were also attentive to evolving geopolitical situations. Notably, the banking sector experienced significant declines, while real estate and retail sectors showed resilience.
In the UK, a noteworthy rise in consumer confidence contributed to a buoyant market, with the FTSE 100 index rising close to 0.8%. The GfK Consumer Confidence Index for the United Kingdom saw a 3-point increase to -18 in November 2024, marking its first upturn in three months.
The pan-European Stoxx 600 saw an increase of 1.18%. The FTSE 100 in the UK advanced by 1.38%, Germany's DAX grew by 0.92%, France's CAC 40 improved by 0.58%, and Switzerland's SMI climbed by 1.08%.
Other European markets, including Belgium, Denmark, Finland, the Netherlands, Poland, Portugal, Russia, Sweden, and Turkiye, recorded substantial to moderate gains. Meanwhile, Austria, Greece, Ireland, Norway, and Spain posted modest gains, with Iceland closing weaker.
Within the UK market:
- Diploma surged approximately 5.8%.
- Spirax Group, Hikma Pharmaceuticals, AstraZeneca, Melrose Industries, British Land, Unilever, National Grid, Rightmove, and Relx rose between 3% and 4.3%.
- Companies like Vistry Group, Sainsbury, Segro, Land Securities, Barratt Redrow, Experian, Auto Trader Group, Weir Group, Unite Group, and GSK also witnessed significant upswings.
Games Workshop Group Plc's shares jumped 17.5%, fueled by optimism regarding the company's robust financial performance potentially securing its inclusion in the FTSE 100 index.
Conversely, Natwest Group dropped nearly 2.5%, with Barclays Group, Standard Chartered, and Lloyds Banking Group declining by 1% to 2.1%, and HSBC Holdings seeing a slight dip. JD Sports Fashion Group and Antofagasta also faced notable losses.
In Germany, Zalando grew by over 6%. Vonovia, Brenntag, Sartorius, E.ON, Infineon, Continental, Merck, Fresenius Medical Care, Siemens Energy, and Symrise saw gains of 2% to 5%. Companies like Daimler Truck Holding, Qiagen, Rheinmetall, Adidas, Bayer, Fresenius, Beiersdorf, Deutsche Post, Deutsche Telekom, Siemens Healthineers, MTU Aero Engines, and BASF rose by 1% to 2%.
Deutsche Bank fell 2.8%, while Commerzbank decreased by 1.7%, and Puma ended about 1% lower.
In Paris, stocks like Unibail Rodamco, Stellantis, Sanofi, Vivendi, and Publicis Groupe increased by 2% to 3.1%. L'Oreal, Essilor, Eurofins Scientific, Hermes International, LVMH, Orange, Danone, and Legrand experienced gains ranging from 1% to 1.8%.
STMicroElectronics saw a marked rise following its announcement of a partnership with Chinese semiconductor firm Hua Hong.
Thales shares declined by around 3.5%, affected by revelations that the UK's Serious Fraud Office is investigating the company for alleged bribery and corruption. Societe Generale, BNP Paribas, and Credit Agricole lost between 2.1% and 2.6%, with Airbus Group, Accor, and Renault also experiencing notable declines.
In economic developments:
- The UK private sector faced its first contraction in over a year this November due to a slowdown in new business growth amidst subdued business confidence, as revealed by a flash survey from S&P Global. The Flash Composite Output Index dropped to 49.9 in November from 51.8 in October.
- UK retail sales fell 0.7% on a monthly basis in October, countering a revised 0.1% rise in September, according to the Office for National Statistics. Expectations were a decrease of 0.3%.
- Germany's economy showed slight growth in the third quarter following a contraction, with GDP rising 0.1% sequentially, as per revised data from Destatis, a downgrade from the initial 0.2% estimate on October 30.
- Germany's private sector continued its contraction in November, with manufacturing output remaining weak, and services activity dropping for the first time in nine months, according to S&P Global's preliminary PMI survey. The HCOB Composite Output Index fell to 47.3 in November, down from 48.6 the prior month, indicating the swiftest decline in activity since February. The services PMI registered 49.4, dropping from 51.6, underperforming the forecast of 51.8. However, the manufacturing PMI improved to a four-month high of 43.2 from 43.0, slightly surpassing the expected 43.1.
- France's private sector saw its most significant contraction since January due to prolonged demand weakness damping expectations, according to S&P Global's preliminary survey findings. The Flash HCOB Composite Output Index fell sharply to 44.8 in November from 48.1 in October. The services PMI dropped more than anticipated to 45.7 from 49.2, with expectations set at 49.0. Meanwhile, the manufacturing PMI came in at 43.2, down from 44.5 in October, with an anticipated slight increase to 44.6.
