© Reuters. FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, July 29, 2021. REUTERS/Staff/File photo
By Sruthi Shankar
(Reuters) -European stocks scaled fresh peaks on Monday, driven by dealmaking activity and strong results from Europe’s biggest bank HSBC, with a rebound in Asian stocks also helping set a bright start to August.
The pan-European index rose 0.6% to hit an all-time high of 464.5 points, with retailers, automakers and miners among the top performers.
British aero-engineer Meggitt (LON:) soared 58.2% to hit a life high after U.S. industrial firm Parker-Hannifin said it would buy the UK rival in a deal valued at $8.76 billion.
Among other deals, British asset management services provider Sanne Group jumped 7.9% after it said it could get a takeover bid from fund servicer Apex Group.
UK’s midcap index gained 0.6%, while the blue-chip added 0.8%. ()
In earnings, Asia-focussed lender HSBC inched up 0.5% after it beat forecasts for first-half pretax profit and reinstated dividend payments.
French insurer Axa gained 2.5% after it posted a 180% surge in first-half net income, while German rival Allianz (DE:) tumbled 6.4% after U.S. regulators started a probe relating to Allianz Global Investors’ Structured Alpha Funds.
Of the more than half of the STOXX 600 companies that have reported second-quarter results so far, 67% have topped profit estimates, as per Refinitiv IBES data.
“Having reached all-time highs post 1Q results, the breadth of positive EPS revisions in Europe remains very strong both in absolute terms and versus peers,” European equity strategists at Morgan Stanley (NYSE:) said in a note. “Europe now sees the best earnings revisions of all global regions.”
Meanwhile, a survey showed manufacturing activity across the euro zone continued to expand at a blistering pace in July, but supply bottlenecks sent input costs soaring.
Optimism around European earnings and economic reopening helped the benchmark STOXX 600 end July with a sixth straight month of gains despite concerns about inflation, soaring virus cases in Asia and a major regulatory crackdown in China.
British jet and auto parts supplier Senior Plc (LON:) jumped 4.3% after it reported a first-half profit compared with a loss a year earlier.
Peer Melrose gained 6.2%, while Rolls-Royce (LON:) added 3.5%.
The world’s second-largest brewer Heineken inched up 0.6% after reporting first-half earnings above expectations, but warned rising commodity costs would eat into margins.
German carmaker Daimler rose 2.2% after Goldman Sachs (NYSE:) added the stock to its conviction list.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.