European Shares Advance On Stimulus Hopes

European stocks rose sharply on Wednesday as investors parsed through a slew of corporate earnings and looked forward to further progress in U.S. stimulus talks.

Sentiment was also boosted after survey data showed the euro zone’s private sector grew at its fastest rate in over two years in July.

The pan European Stoxx 600 was up 0.7 percent at 366.01 after ending little changed with a negative bias on Tuesday.

The German DAX rose about 1 percent, France’s CAC 40 index gained 0.9 percent and the U.K.’s FTSE 100 was up 1.2 percent.

Ahold Delhaize NV, a major operator of supermarket chains in the United States and Europe, surged 6 percent. The company raised its guidance for the year after reporting strong Q2 results.

Bank of Ireland jumped 5 percent. After posting a loss for the first half of the year, the lender said it will cut 1,400 jobs in the coming years to rein in costs.

Tech stocks were moving up, with Dialog Semiconductor surging 5 percent and Infineon Technologies adding 1.3 percent.

Residential real estate company Vonovia rallied 3.6 percent. The company confirmed its guidance for the year after reporting an 8 percent rise in first-half core profits.

Automaker BMW tumbled 3 percent after it swung to a 666 million billion euros ($786 million) loss before interest and taxes in the quarter ending June.

Continental advanced 1.9 percent. The auto parts supplier swung to a loss in the second quarter and said that there are still big economic uncertainties.

Commerzbank jumped 4.3 percent. The bank revised outlook for the full-year due to losses tied to the Wirecard AG scandal.

Logistics group Deutsche Post climbed 1.7 percent after its second quarter sales beat estimates.

Eurofins Scientific shares gained 2 percent. Eurofins U.S. Clinical Diagnostics, affiliated to Eurofins Scientific, announced today the launch of lower cost highly accurate COVID-19 PCR test.

Life insurer Legal & General fell nearly 2 percent after it reported a 2 percent decline in first-half operating profit.

Ferrexpo shares surged 9 percent. The iron ore producer declared a second interim dividend after both sales and production volumes increased in the first half of the trading year.

PageGroup climbed 3.1 percent. After posting a half-year loss, the recruiter said activity has started to pick up and there have been improvements such as new opportunities, candidates sent to clients, interviews and offers.

Bookmaker William Hill soared 5.2 percent. The company said that trading has recovered well post-lockdown and it is repaying £24.5m of U.K. furlough funds.

In economic news, the euro area private sector expanded at the fastest pace since mid-2018 after four months of contraction, final data from IHS Markit showed today.

The IHS Markit final composite output index rose to 54.9 in July from 48.5 in June as easing of Covid-19 lockdown restrictions boosted demand and expectations. The flash reading was 54.8.

Both the manufacturing and service sectors reported marked rates of growth in July, with manufacturing registering the slightly stronger pace of expansion.

Separately, Eurozone retail sales grew at a moderate pace in June after rebounding sharply in May, data from Eurostat showed. Retail sales increased 5.7 percent on a monthly basis, following a 20.3 percent increase in May. Economists had forecast a 5.9 percent increase for June.

The U.K. service sector logged its strongest growth in five years in July as the phased reopening of business operations lifted corporate and household spending, final data from IHS Markit showed.

The final IHS Markit/Chartered Institute of Procurement & Supply services Purchasing Managers’ Index rose to 56.5 in July from 47.1 in June. The flash score was 56.6.

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