EU stocks up as investors observe coronavirus spread, economic data

European stocks climbed on Wednesday morning as investors put the spread of the new coronavirus under microscope while observing fresh economic data.

The pan-European Stoxx 600 increased 0.5% by mid-morning having earlier notched a new record high. Basic resources and household goods added 0.8% to lead gains as most sectors and major bourses entered positive territory.

European shares were also strengthened slightly by a stronger euro, though the common currency edged up 0.1% to trade at around $1.0802 on Wednesday morning.

Puma shares jumped 8.3% after the German sportswear brand beat fourth-quarter sales and earnings expectations, and said it still hopes to reach 2020 targets despite an expected first-quarter hit from the coronavirus outbreak.

Deutsche Telekom on Wednesday forecast that growth in its core earnings would slow to 3% this year after a strong fourth quarter. Europe’s largest mobile operator projected adjusted earnings before interest, taxation, depreciation and amortization (EBITDA) hit 25.5 billion euros ($27.5 billion), missing analyst expectations. Deutsche Telekom shares gained 3% in early trade.

At the bottom of the European benchmark, Ageas shares fell 5.7% after the Belgian insurer missed full-year earnings expectations and warned of the direct impact of claims linked to the coronavirus outbreak.

Italy’s Campari slipped 2.2% after reporting weak fourth-quarter earnings and downbeat 2020 guidance, while Royal Mail dropped 4.1% after Liberum cut its price target for the stock on the grounds that 2024 transformation targets are undeliverable.

source: CNBC