European stock indices rose on Wednesday thanks to positive statistical data and forecasts from Germany as well as corporate news.
The Stoxx Europe 600 composite index of the region’s largest companies rose 0.8 percent to 427.51 points as of 11:30 a.m. The indicator ends 2022 with a decline of about 13% – the maximum since 2018, due to the negative impact of the situation in Ukraine, as well as the energy crisis on corporate profits and the economy as a whole, Bloomberg notes.
“We are facing a slowdown in economic growth, if not a recession, and we don’t see that factor being built into corporate earnings forecasts yet,” UBS Private Wealth Management financial adviser Sarah Poncheck said on Bloomberg TV.
Germany’s DAX stock index gained 0.76% in trading, France’s CAC 40 gained 0.91%, Britain’s FTSE 100 gained 0.44%, Italy’s FTSE MIB gained 0.68% and Spain’s IBEX 35 gained 0.55%.
Data from research firm GfK, released Wednesday, showed improved consumer sentiment in Germany. The leading indicator assessing consumer confidence prospects for January 2023 rose to minus 37.8 points from minus 40.1 points in December. The index has been rising for three months in a row thanks to measures taken by the German authorities to reduce energy costs for residents, GfK noted.
“It is clear that the steps taken by the German authorities to limit energy prices are having an effect. However, it is too early to say that all the problems are over. The improvement in consumer sentiment that we are seeing at the moment remains fragile,” said GfK consumer sector expert Rolf Bürkl.
“The German Employment Barometer, calculated by the Ifo economic institute, shows a positive outlook for the German labor market in the first quarter of next year. This is mainly due to improvements in the service sector, whose workers are optimistic about the near future, the Ifo said Wednesday.
Stock prices of European sports goods manufacturers rose on Wednesday thanks to stronger-than-expected reports from U.S. competitor Nike Inc. Shares of Adidas AG jumped 7.7%, Puma SE rose 8.5% and British sporting goods retailer JD Sports gained 6.7%.
Uniper SE shares rose 5.9% after the European Commission approved a stabilization package providing, in particular, to increase the capital of the energy company by 8 billion euros.
Among the leaders of growth in Germany were the shares of online retailer Zalando (+4.5%), real estate company Vonovia (+2.6%) and Deutsche Post (+1.3%).
In Britain, Prudential Plc (+1.5%), Shell (+0.9%), Diageo (+0.8%) gained strongly, in France – TotalEnergies SE (+1.6%), L’Oreal (+1.4%), Schneider Electric (+1.3%).
