EUROPEAN EQUITY TRADED POSITIVE
Major bourses in Europe pared some gains, with the Dax adding 1% after rising as much as 2.2% early in the session while the Stoxx 600 was up nearly 1%, led by retail, travel and leisure shares. Stocks attempt to rebound from a big plunge the day before prompted by growing fears of a recession. Investors welcomed news that a strike was called off by Norwegian oil and gas workers while upbeat factory orders data for Germany and industrial production for Spain also offered some support. In contrast, retail sales for the Euro Area disappointed. Still, traders remain cautious ahead of the FOMC minutes release, and as talks of gas rationing in Europe continue.
The FTSE 100 traded up more than 2% on Wednesday, after posting its worst single-day drop in three weeks on Tuesday, amid looming recession fears. Still, market volatility is set to continue as investors react to political turmoil in the UK after both Chancellor Rishi Sunak and Health Secretary Sajid Javid resigned. Among single stocks, Abrdn PLC surged by over 7% after it unveiled a £300mln share buyback programme, with the first phase of £150mln starting today.
The CAC 40 was up almost 2% around the 5,900 level, rebounding from a 4-month low hit in the previous session, lifted by the automotive and luxury sectors. However, concerns persist about recession and gas prices in Europe, with investors awaiting the minutes from the Fed’s last monetary policy meeting after the closing bell. Safran jumped close to 4%, topping the index after Air-France KLM agreed to buy 200 Leap1-A engines from the aircraft manufacturer. Elsewhere, Alstom added more than 3% as it confirmed receiving EUR 387 million orders for railway Construction in Madhya Pradesh, India. Among Luxury, Loreal advanced 3.7%, LVMH 3.4% and Hermes 3.2% among others.
The ibex 35 pared early gains to trade near the flatline at 7,961 on Wednesday, as caution prevailed amid lingering concerns about elevated inflation, central bank decisions and fears of an economic slowdown. Investors continued to monitor the energy crisis in Europe while awaiting the release of FOMC minutes later in the day for clues about the path of monetary tightening. On the corporate front, sharp losses in banks were partly offset by solid gains in Indra and Inditex.
The FTSE MIB index was 0.7% higher to hover above the 20,850 mark on Wednesday, rebounding from the near 20-month lows touched last session with support from the banks and the tech sector. Equity markets remain highly volatile, with investors continuing to weigh on recession concerns, inflationary pressure, and uncertainty revolving energy supply in Europe while awaiting the release of minutes from the Federal Reserve’s last meeting after the closing bell. The heavyweight financial sector led the gains in Milan, with Banca Mediolanum, Banca Generali, and Azimut Holding all adding 2%. Among the smaller companies, ePrice shares were halted from trading after surging 10.9% following the sale of its operations to Portobello.
