EUROPE MARKETS: European Stocks Get A Lift As North Korea Tensions Cool
September 18 2017 - 8:17AM
Dow Jones News
By Carla Mozee, MarketWatch
Ryanair shares drop after flight cancellations; Bundesbank sees
growth momentum slowing
European stocks pushed higher Monday, with the week getting
under way with tensions surrounding North Korea cooling, but
Ryanair Holdings PLC underperformed the broader market as the
company canceled hundreds of flights.
The Stoxx Europe 600 index picked up 0.3% to 381.98. All sectors
were higher, led by the telecommunications and industrial groups.
On Friday, the pan-European benchmark slipped 0.3%
(http://www.marketwatch.com/story/european-stocks-head-for-16-weekly-rise-as-investors-shake-off-north-korea-jitters-2017-09-15),
but finished last week up by 1.4%.
Monday's gains followed advances in Asian equity markets, where
South Korea's Kospi Index jumped 1.4%. U.S. Secretary of State Rex
Tillerson said the U.S. is seeking "a peaceful solution" to the
conflict with North Korea as a military option is the only one left
if diplomatic efforts fail. Tillerson made the remarks on CBS's
"Face the Nation" on Sunday
(https://www.cbsnews.com/news/transcript-u-s-secretary-of-state-rex-tillerson-on-face-the-nation-sept-17-2017/).
"Tensions with North Korea are likely to remain a distraction,
however markets appear to be becoming desensitised to them at this
time," said CMC Markets UK chief market analyst Michael Hewson, in
a note.
Investors also started the week seeing that Friday's session on
Wall Street
(http://www.marketwatch.com/story/dow-sp-500-line-up-for-fresh-records-to-start-the-week-2017-09-18)
ended with record highs for the S&P 500 Index and the Dow Jones
Industrial Average .
"After further new highs in U.S. equity markets on Friday, it is
no surprise that European equity markets are playing catch up,"
wrote Rebecca O'Keeffe, head of investment at Interactive
Investor.
However, "the expectation is that markets will remain relatively
quiet ahead of significant central bank comments and decisions this
week, with [Bank of England Governor] Mark Carney's address to the
IMF today, the Federal Reserve decision on Wednesday and the Bank
of Japan statement on Thursday," she said.
Stock movers: Ryanair Holdings PLC (RYAAY) dropped 2% as the
carrier continued its plan, started late week, to cancel between 40
to 50 flights a day over the next six weeks in a bid to improve
punctuality.
Hiscox Ltd. (HSX.LN) fell 2.4% as the insurer estimated net
claims from Hurricane Harvey will total $150 million
(http://www.marketwatch.com/story/hiscox-puts-hurricane-harvey-claims-at-150-mln-2017-09-18).
The company said it will announce an estimate for Hurricane Irma
once the storm's impact becomes clearer.
Telecom Italia SpA shares (TIT.MI) were up 3.3% following
reports the Italian government will examine France's Vivendi SA's
(VIV.FR) control of the Italian telecommunications company. The
review will aim to establish whether Vivendi complied with legal
obligations when it built its stake in Telecom Italia, according to
the New York Times
(https://www.nytimes.com/reuters/2017/09/17/business/17reuters-vivendi-telecom-italia-goldenpower.html?partner=IFTTT).
Data: Eurostat confirmed eurozone inflation rose to 1.5% in
August, and core inflation rose to 1.2%, with both figures meeting
expectations. Headline inflation was 1.3% in July.
German economic growth may have lost some momentum during the
third quarter, Bundesbank said in its September report released
Monday
(https://www.bundesbank.de/Redaktion/DE/Downloads/Veroeffentlichungen/Monatsberichte/2017/2017_09_monatsbericht.pdf?__blob=publicationFile),
as some economic indicators at the start of the summer quarter were
more subdued than expected. But overall, the central bank expects
growth to remain on a strong expansionary course.
National indexes: Germany's DAX 30 index pared gains after the
Bundesbank report. The benchmark was up 0.2% at 12,549.70. France's
CAC 40 index moved up 0.2% to 5,226.36. The FTSE 100 was up 0.4% to
7,247
(http://www.marketwatch.com/story/ftse-100-reaches-for-first-gain-in-5-sessions-as-geopolitical-tensions-ease-2017-09-18).
In Portugal, the PSI 20 climbed 1.2% after S&P Global
Ratings late Friday raised Portugal's credit rating to
investment-grade status
(http://www.marketwatch.com/story/sp-raises-portugal-credit-rating-to-investment-grade-2017-09-15),
up by one notch to BBB-. The yield on Portugal's 10-year dropped 26
basis points to 2.50% as prices climbed.
The euro bought $1.1952, little changed from $1.1947 late Friday
in New York.
Read:German election: Who's Merkel up against and what are their
chances?
(http://www.marketwatch.com/story/german-election-whos-merkel-up-against-and-how-could-they-shape-the-new-government-2017-08-31)
Also:Don't call the German election boring -- it could be huge
leap or setback for the eurozone
(http://www.marketwatch.com/story/dont-call-the-german-election-boring-it-could-mean-a-huge-shift-for-the-eurozone-2017-09-18)
(END) Dow Jones Newswires
September 18, 2017 08:02 ET (12:02 GMT)
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