European Stocks Close On Firm Note On Optimism About More Interest Rate Cuts

(RTTNews) - European stocks closed on a firm note on Friday as some weak economic data raised expectations that the central banks will reduce interest rates further to boost growth.

In addition to digesting regional economic data, investors continued to follow the developments on the geopolitical front.

Bank stocks ended notably lower, while real estate and retail stocks are finding support.

Data showing an increase in consumer confidence aided sentiment in the UK market, where the benchmark FTSE 100 is gaining nearly 0.8%. The GfK Consumer Confidence Index in the United Kingdom increased by 3 points to -18 in November 2024, marking its first improvement in three months.

The pan European Stoxx 600 climbed 1.18%. The U.K.'s FTSE 100 gained 1.38%, Germany's DAX and France's CAC 40 closed up 0.92% and 0.58%, respectively, while Switzerland's SMI advanced 1.08%.

Among other markets in Europe, Belgium, Denmark, Finland, Netherlands, Poland, Portugal, Russia, Sweden and Turkiye closed with sharp to moderate gains.

Austria, Greece, Ireland, Norway and Spain ended modestly higher, while Iceland closed weak.

In the UK market, Diploma climbed about 5.8%. Spirax Group, Hikma Pharmaceuticals, AstraZeneca, Melrose Industries, British Land, Unilever, National Grid, Rightmove and Relx gained 3 to 4.3%.

Vistry Group, Sainsbury (J), Segro, Land Securities, Barratt Redrow, Experian, Auto Trader Group, Weir Group, Unite Group and GSK also moved up sharply.

Games Workshop Group Plc shares soared 17.5% on hopes the company's strong results will help get the stock into the FTSE 100 index.

Natwest Group closed nearly 2.5% down. Barclays Group, Standard Chartered and Lloyds Banking Group ended down 1 to 2.1%, while HSBC Holdings settled modestly lower.

JD Sports Fashion Group and Antofagasta closed notably lower.

In the German market, Zalando rallied more than 6%. Vonovia, Brenntag, Sartorius, E.ON, Infineio, Continental, Merck, Fresenius Medical Care, Siemens Energy and Symrise gained 2 to 5%.

Daimler Truck Holding, Qiagen, Rheinmetall, Adidas, Bayer, Fresenius, Beiersdorf, Deutsche Post, Deutsche Telekom, Siemens Healthineers, MTU Aero Engines and BASF closed up 1 to 2%.

Deutsche Bank closed down 2.8%. Commerzbank drifted down 1.7%, while Puma closed lower by about 1%.

In Paris, Unibail Rodamco, Stellantis, Sanofi, Vivendi and Publicis Groupe gained 2 to 3.1%. L'Oreal, Essilor, Eurofins Scientific, Hermes International, LVMH, Orange, Danone and Legrand advanced 1 to 1.8%.

STMicroElectronics closed notably higher after the company announced a partnership with Chinese chipmaker Hua Hong.

Thales closed down by about 3.5% weighed down by reports that the UK's Serious Fraud Office has opened an investigation into the company over alleged bribery and corruption.

Societe Generale, BNP Paribas and Credit Agricole lost 2.1 to 2.6%. Airbus Group, Accor and Renault also closed notably lower.

In economic news, the UK private sector activity deteriorated for the first time in just over a year in November as growth in new business eased amid weak business confidence, flash survey results published by S&P Global revealed. The flash composite output index dropped to 49.9 in November from 51.8 in October.

UK retail sales dropped 0.7% on a monthly basis in October, in contrast to the revised 0.1% rise in September, data from the Office for National Statistics showed. Sales were expected to fall 0.3%.

The German economy grew marginally in the third quarter after a contraction, with the GDP recording a sequential growth of 0.1%, revised data from Destatis showed. The rate was downgraded from 0.2% estimated on October 30.

Germany's private sector continued to contract in November as sustained weakness in manufacturing output was compounded by the first fall in services activity for nine months, flash Purchasing Managers' survey compiled by S&P Global showed.

The HCOB composite output index dropped to 47.3 in November from 48.6 in the previous month. The score signaled acceleration in the rate of decline in activity to the quickest since February.

Services business activity fell into contraction for the first time in nine months in November. The services PMI registered 49.4, down from 51.6 in the previous month. The expected score was 51.8. Meanwhile, the manufacturing PMI advanced to a four-month high of 43.2 from 43.0 in the previous month. The reading was slightly above forecast of 43.1.

France's private sector contracted the most since January as prolonged weakness in demand damped expectations, flash survey results from S&P Global showed. The flash HCOB composite output index fell markedly to 44.8 in November from 48.1 in October.

The services Purchasing Managers' Index dropped more-than-expected to 45.7 from 49.2 in the previous month. The score was seen at 49.0. The factory PMI posted 43.2, which was down from 44.5 in October. The indicator was expected to edge up to 44.6.