European stocks concluded Thursday on a positive trajectory, with key markets across the region reaching multi-month or new record highs. This was primarily driven by optimistic earnings reports and favorable economic data from both Europe and the United States, enhancing overall market sentiment.
Investor confidence remained buoyant following reassuring U.S. inflation data, which have bolstered expectations that the Federal Reserve might implement several interest rate cuts within the year.
In the UK, the stock market saw gains, underpinned by data reflecting GDP growth in November, as well as a boost in the mining sector due to rising metal prices.
In France, luxury goods companies saw an uplift, notably following Richemont’s release of strong sales figures.
The Stoxx Europe 600 index advanced by 0.98%. Meanwhile, the UK's FTSE 100 increased by 1.09%, Germany's DAX rose by 0.39%, and France's CAC 40 surged by 2.14%. Switzerland's SMI climbed by 1.36%.
Elsewhere in Europe, markets in Belgium, Greece, Iceland, the Netherlands, Portugal, Russia, Sweden, and Turkey experienced gains.
Conversely, Denmark, Ireland, Norway, Poland, and Spain ended on a weaker note, while Austria and Finland remained largely unchanged.
Within the UK market, notable performers included RightMove, Spirax Group, Experian, Games Workshop Group, and others like Hiscox, Beazley, and Rolls-Royce Holding, showing increases ranging from 2% to 4.3%. However, JD Sports Fashion dropped nearly 6%, and companies like Taylor Wimpey, Whitbread, and EasyJet fell between 1.2% and 3%.
In Germany, Zalando surged almost 8%, with Rheinmetall climbing 3.8% and others like Hannover Rueck and MTU Aero Engines gaining between 1% and 2%. Siemens Energy fell by 3.4%, Puma by nearly 3%, and both Daimler Truck Holding and Mercedes-Benz slid by about 2%.
The French market saw LVMH rise by approximately 9%, and Kering gained 5.6% after selling a majority stake in three luxury properties to Ardian SAS, securing €837 million ($861 million) from the transaction. Hermes International advanced by about 4.8%, and Unibail Rodamco climbed 3.3%. Renault also saw a sharp increase after reporting a 1.3% rise in sales volume for 2024 due to greater electric vehicle uptake.
Additional French companies like TotalEnergies, L'Oreal, Sanofi, and others posted gains between 1% and 2.7%. Teleperformance, however, declined following a court's approval of a $5.5 million settlement related to a 2022 controversy. Stellantis, Carrefour, Teleperformance, Saint-Gobain, and Publicis Groupe finished moderately lower.
On the economic front, Destatis confirmed that Germany's consumer price index rose by 2.6% in December, up from 2.2% in November, aligning with preliminary data. This rate was the highest since January 2024 when it reached 2.9%. Consumer prices increased by 0.5% in December, revised from 0.4%. The EU-harmonized inflation remained at 2.8%, with November's rate revised from 2.4%.
The UK's Office for National Statistics revealed a slight GDP growth of 0.1% in November following two consecutive contractions, albeit slightly below the anticipated 0.2%. The services sector emerged as the primary growth contributor, with a 0.1% output increase after a similar decline in October. The downturn in industrial production lessened to 0.4% from 0.6%, with manufacturing decreasing by 0.3%. November's GDP was estimated to be 1% higher than the previous year, falling short of the 1.3% growth forecast by economists. Over the three months leading to November, there was no growth compared to the preceding three-month period.
Additionally, the UK’s visible trade deficit remained mostly unchanged in November, recorded at GBP 19.31 billion, slightly narrower than October's GBP 19.33 billion deficit.
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