Europe close: Stocks edge up after May PMIs

23rd May 2024 16:22

(Sharecast News) - European stocks were mostly firmer on Thursday, buoyed by the latest reading on eurozone business activity and blowout earnings from US tech giant Nvidia.

The benchmark Stoxx 600 index edged up 0.07% to 521.56 while Germany's DAX put on 0.06% to 18,691.32. Spain's Ibex 35 was the exception, dipping 0.16% to 11,311.10.

Semiconductor stock Infineon was ahead by 1% after Nvidia's first-quarter earnings beat expectations, with revenue up a whopping 262%.

Dan Coatsworth, investment analyst at AJ Bell, said: "Expectations were high for Nvidia in the run-up to its latest results so to smash forecasts is a major achievement. That makes it six quarters in a row it has beaten the consensus earnings estimate and seven consecutive quarters for revenue. The chip giant is riding a gigantic wave that shows little sign of losing power.

Elsewhere, UK investment platform Hargreaves Lansdown surged 14% after confirming it had rejected a 985p per share takeover offer from a consortium comprising CVC, Nordic Capital and Platinum Ivy, which is a wholly-owned subsidiary of Abu Dhabi Investment Authority. It said the proposal "substantially undervalues" Hargreaves Lansdown and its future prospects.

Budget airline Wizz Air flew 11% higher after saying it swung to a profit of €365.9m in the year to the end of March from a loss of €531.1m the year earlier amid "sustained" demand.

On the macro front, the HCOB flash eurozone composite PMI output index rose to 52.3 (consensus: 42.0) for May from 51.7 in April, marking the third month in a row that business activity expanded.

The overall expansion was again driven by the services sector, where activity was up for the fourth month in a row, albeit at unchanged pace versus that seen in April.

Dr. Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, said that the data looked as good as it could with the economy gaining strength and price pressures softening.

"This will be supportive for the apparent stance of the ECB to cut rates at the meeting on June 6. However, the better inflation outlook will be most probably not be enough for the central bank to announce that further rate cuts will follow suit."