UPDATE 2-European stocks flat despite rise in cyclicals

  • Reuters
  • Stock Market News
UPDATE 2-European stocks flat despite rise in cyclicals
Credit: © Reuters.

(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window)

* Cyclical stocks lead gains again

* London's FTSE hit by stronger pound

* Maersk gains after Berenberg upgrade

(Updates to market close)

By Sruthi Shankar

Jan 12 (Reuters) - European stocks closed flat on Tuesday, with economically sensitive sectors including banks, automakers and oil supporting markets across the continent.

The regional STOXX 600 index .STOXX closed up 0.05% after a mixed session, while Germany's DAX .GDAXI rose 0.1%, France's CAC .FCHI inched 0.2% lower and Britain's FTSE 100 .FTSE fell 0.7%.

Investors are awaiting the start of the U.S. earnings season this week as well as clarity on fiscal spending plans under incoming U.S. President Joe Biden, who takes office on Jan. 20.

In Europe, automakers .SXAP jumped 1.7% to lead gains after Renault RENA.PA , BMW BMWG.DE and VW VOWG_p.DE reported 2020 sales. U.S. carmaking rivals also got a boost after General Motors (NYSE: GM ) GM.N announced its entry into the growing electric delivery vehicle business. cyclicals such as banks .SX7P , travel and leisure .SXTP and oil and gas .SXEP extended last week's rally on hopes that a larger U.S. stimulus under the incoming Biden administration will spur faster economic recovery.

Oil majors BP BP.L and Royal Dutch Shell RDSa.L gained close to 2% as crude prices hit an 11-month high on tighter supply and expectations for a drop in U.S. inventories. O/R

Still, losses in defensive sectors such as healthcare, utilities and consumer staples checked gains in most markets.

"Investors are still wondering where the next big catalyst for further upside will come from, and are painfully aware that the COVID-19 crisis remains untamed despite the introduction of vaccination programmes," Chris Beauchamp, chief market analyst at IG wrote in a client note.

Britain's exporter-heavy FTSE 100 .FTSE underperformed other European markets, hit by a stronger pound and a surge in new COVID-19 cases. GBP/

Companies listed on Europe's STOXX 600 are expected to report a 26.3% drop in fourth-quarter earnings, data from Refinitiv I/B/E/S shows, as restrictions to control soaring coronavirus cases slowed an economic recovery.

That comes ahead of a clear improvement predicted for the first two quarters of 2021, when earnings are set to rise 40.4% and 75.1% respectively. MAERSKb.CO rose 3.4% after brokerage Berenberg upgraded the Danish shipping company's shares to "buy", saying earnings momentum driven by freight prices could see it run higher. online pharmacy chain Zur Rose ROSEG.S hit a record high, surging almost 15% to the top of STOXX 600, after BofA Global Research started coverage with "buy" rating.

Add Chart to Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

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

Error: File type not supported

Drop an image here or

100
Please try another search