European stocks rise after UK economy grows; Burberry issues profit warning

  • Investing.com
  • Stock Market News
European stocks rise after UK economy grows; Burberry issues profit warning
Credit: © Reuters.

Investing.com - European stock markets climbed higher Friday, boosted by U.K. economic growth as investors await more U.S. inflation data and big bank earnings. 

At 03:10 ET (08:10 GMT), the DAX index in Germany traded 0.9% higher, the CAC 40 in France traded up 0.8% and the FTSE 100 in the U.K. rose 0.9%.

U.K. GDP grew more than expected in November

Data released earlier Friday showed that Britain's economy grew slightly more strongly than expected in November, with the country’s gross domestic product rising 0.3% in November, beating forecasts for a 0.2% expansion.

Industrial and manufacturing production both expanded in November, after sharp retreats the prior month, raising hope that the country’s economy, one of the weakest in Europe, is now on track for growth.

"The longer-term picture remains one of an economy that has shown little growth over the last year," ONS chief economist Grant Fitzner said.

"GDP bounced back in the month of November, however, led by services with retail, car leasing and computer games companies all having a buoyant month."

Elsewhere in Europe, French CPI was confirmed rising to 3.7% in December on an annual basis, from 3.5% the prior month, while Spanish CPI came in at 3.1%, a small drop from 3.2%.

The main inflation focus Friday, however, will be on U.S. producer prices, especially after the country’s consumer prices came in a little hotter than expected on Thursday.

U.S. PPI is expected to rise 0.1% on the month in December, an annual rise of 1.3%, while the ‘ core ’ figure, which excludes volatile food and energy prices, is seen falling to 1.9% on an annual basis.  

Burberry issues profit warning

In the corporate sector, Burberry (LON: BRBY ) stock slumped over 8% after the British luxury fashion brand warned on its full year profit outlook for the second time in three months, blaming a further slowing in global demand.

Rivals, such as LVMH (EPA: LVMH ) and Kering (EPA: PRTP ), have also reported lower demand for high-end goods in key markets including the United States, Europe and China.

A lot of attention, however, will be on the U.S. banking sector, with results due later Friday from a series of banking giants, including Bank of America (NYSE: BAC ), Citigroup (NYSE: C ) and JPMorgan Chase (NYSE: JPM ).

Crude soars after strikes on Yemen

Oil prices soared Friday after U.S.-led forces launched airstrikes against the Iran-backed Houthi group in Yemen, increasing concerns over disruptions to Middle East supplies.

By 03:10 ET, the U.S. crude futures traded 2.5% higher at $73.84 a barrel, while the Brent contract climbed 2.4% to $79.28 a barrel.

The United States and Britain carried out the strikes in retaliation for attacks by the Iran-backed group on shipping in the Red Sea starting from late last year, and came shortly after Iran seized an oil tanker with Iraqi oil in the Gulf of Oman.

Several major shipping operators have decided to steer clear from the region, disrupting supplies on the key route between Europe and Asia, which accounts for about 15% of the world's shipping traffic. 

Additionally, gold futures rose 1.2% to $2,043.60/oz, while EUR/USD traded 0.1% higher at 1.0974.

 

Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb

Error: File type not supported

Drop an image here or

100