Europe stocks advance amid earnings; coronavirus fears ease
European markets traded higher on Tuesday as sentiment improves and investors brush aside economic fears over the coronavirus outbreak.
The pan-European Stoxx 600 climbed 0.9% in early deals, with basic resource stocks each adding 2.8% to lead gains as all sectors and major bourses entered positive territory.
Global markets are seeing a rebound in sentiment after sharp declines related to concerns over the spread of the coronavirus. In Asia, mainland Chinese stocks were higher by Tuesday as investors weighed the potential economic impact of the outbreak. As of end of Monday, there were a total of 425 deaths and 20,438 confirmed cases in the country.
Two Chinese state media outlets on Tuesday urged investors not to panic over the plunge in mainland markets a day earlier.
In the U.S., results from the first-in-the-nation Iowa caucuses were delayed Monday night as the state’s Democratic Party said a “reporting issue” caused “inconsistencies” in some data.
Market focus in Europe will be also concentrated on the forthcoming trade talks between the U.K. and EU. On Monday, both sides set out their diverging negotiating positions on a future relationship, setting up likely obstacles in forthcoming trade talks, as well as some areas where compromise could be found.
On the data front, euro zone producer prices are released Tuesday.
Earnings remain a key driver of individual share price action, with Danish hospital equipment maker Ambu leaping 15% at the start of trading after reporting double-digit sales growth for the first quarter of 2019/20.
At the other end of the European blue chip index, Micro Focus saw its shares plummet 13.5% on the back of its chairman’s resignation following a “challenging year,” as the British IT company posted a pre-tax loss for fiscal 2019.
Carlsberg reorted full-year sales broadly in line with expectations and forecast mid single-digit organic profit growth in 2020, sending the Danish brewer’s shares 1.6% higher.
Energy giant BP posted better-than-expected full-year net profit, reporting a year-on-year fall of 21% on weak oil and gas prices. BP shares climbed 3.6%.