Europe close: Stocks higher as sentiment steadies

14th Feb 2024 20:40

(Sharecast News) - European markets rallied on Wednesday as the eurozone avoided a technical recession and posted better-than-expected industrial production figures.

Some analysts also believed that investors were re-assessing their pessimism around the inflation outlook in the States from the day before.

The pan-European Stoxx 600 index was up 0.50 at 485.24, alongside a 0.68% rise for the German Dax to 16,945.48.

All the other main regional indices were also higher with the exception of Spain's Ibex 35, which drifted lower by 0.09% to 9,916.60.

"Those hoping for a second day of heavy losses for stocks have been disappointed. Dip buyers have come in following yesterday's drop in the wake of US inflation data, mounting a holding action that is preventing any further downside for the time being, said IG chief market analyst Chris Beauchamp.

"Bullish hopes rest in the view that the Fed is unlikely to shift position after one reading."

Euro area GDP grew 0% in the final quarter of 2023, in line with the flash reading, statistics office Eurostat said on Wednesday, which also confirmed that output fell 0.1% in the prior three months.

Two quarters of consecutive declines in output are usually counted as a technical recession.

Germany, which is the largest economy in Europe, contracted by 0.3% in the final quarter of 2023

Further boosting entiment, UK inflation was unchanged at 4% year-on-year in January, ONS reported (consensus. 4.1%).

In equity news, ABN Amro shares gained after the Dutch bank beat fourth-quarter profit expectations on the back of high interest and credit impairment releases.

Coca-Cola HBC surged by 6% after it posted record profits last year driven by surging sales and volumes for sparkling drinks and coffee combined with costs easing in the second half.

Thyssenkrupp plunged as the German company cut its annual sales and net profit forecasts due to softening demand and prices at its steel division.