European Shares Rise With Georgia Runoff In Focus
European stocks rose slightly on Wednesday after Democrats won one hotly contested U.S. Senate race in Georgia and pulled ahead in a second, raising hopes for larger stimulus in the world’s largest economy.
Winning both seats would allow Democrats to avert gridlock in Congress and give Biden a chance to enact his legislative agenda.
The pan European Stoxx 600 edged up 0.2 percent to 401.89 after closing 0.2 percent lower on Tuesday. The German DAX rose 0.4 percent, France’s CAC 40 index gained 0.3 percent and the U.K.’s FTSE 100 was up nearly 1 percent.
Cyclicals such as banks and automakers were broadly higher as Democrats claimed the first of two key election runoffs. Commerzbank, BNP Paribas and Renault all rose over 3 percent.
Oil heavyweight BP Plc soared 3.8 percent, Royal Dutch Shell rallied 2.2 percent and Total SE added 2 percent after Saudi Arabia agreed to reduce output more than expected in a meeting with allied producers.
Informa advanced 2.2 percent. The publishing company said the Group’s performance for 2020 will be in line with the revenue guidance provided at the half-year results in September 2020.
Aggreko jumped 3 percent. The supplier of temporary power generation equipment confirmed that it has now agreed and signed the necessary contract revisions with The Tokyo Organizing Committee of the Olympic and Paralympic Games to reflect both scope changes and the impact of the delay of the Games into this year.
Bakery chain Greggs surged as much as 8.4 percent. The company said it does not expect profits to return to pre-Covid levels until 2022 at the earliest.
In economic news, U.K. shop prices continued to fall in December, data from the British Retail Consortium revealed. The shop price index declined 1.8 percent on a yearly basis in December, the same rate as seen in November.
French consumer prices remained stable on a yearly basis in December, after rising 0.2 percent in November, the provisional estimate revealed. Final data is due on January 15.
IHS Markit’s final December Composite Purchasing Managers’ Index rose to 49.1 from November’s 45.3 but that was below a flash reading of 49.8. The services PMI came in at 46.4, far weaker than the 47.3 preliminary estimate.
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