European equity markets closed mostly higher on Thursday, with mining stocks leading the charge due to rising metal prices. However, gains were tempered by a downturn in retail stocks, concerns over potential tariff measures from U.S. President-elect Donald Trump, and ongoing inflation worries.
Trading volumes were slightly muted as U.S. markets were closed in tribute to former President Jimmy Carter, who passed away in late December at the age of 100. A state funeral was held to honor the 39th president.
In regional markets, the U.K.'s FTSE 100 saw a solid performance, climbing 0.83%. France's CAC 40 rose 0.51%, while Germany's DAX slipped by 0.06%, impacted by recent disappointing data on factory orders and retail sales. The pan-European Stoxx 600 increased by 0.42%.
Markets in Austria, Denmark, Greece, Iceland, Netherlands, Norway, Poland, Portugal, Spain, Sweden, and Turkey also finished higher. Conversely, Russia ended on a weaker note, while Belgium, Finland, and Ireland were flat.
In the UK, mining firms such as Anglo American Plc, Antofagasta, and Fresnillo surged by approximately 3.25%. Rio Tinto advanced by 1.8%, and Endeavour Mining gained around 1.5%. Other notable gainers included Compass Group, Smith (DS), Hikma Pharmaceuticals, AstraZeneca, JD Sports Fashion, RightMove, IAG, Barratt Redrow, Games Workshop, Smith & Nephew, St. James's Place, Aviva, Weir Group, and Informa, which rose between 1.5% and 2.5%. HSBC Holdings, ICG, IMI, Bunzl, Shell, and Spirax Group also closed with significant gains.
Marks & Spencer fell 8.4% despite reporting a 5.6% increase in third-quarter sales. B&M European Value Retail dropped 8.6% following a revised profit outlook, despite a 3.5% growth in sales. Tesco managed to recover slightly from lows, finishing slightly down, after announcing a 3.7% increase in Christmas sales.
Greggs plummeted over 9% after reporting 2 billion pounds in 2024 sales but witnessing a slowdown in like-for-like sales growth during the fourth quarter.
Entain closed 4.4% lower, and Sainsbury's (J) fell about 3.2%. Centrica, WPP, Kingfisher, Natwest Group, Hiscox, Associated British Foods, and EasyJet each declined by 1% to 1.7%.
In the German market, Siemens Energy rallied close to 3%, with Commerzbank, HeidelbergCement, Deutsche Bank, Sartorius, and Fresenius gaining 1.7% to 2.6%. However, RWE, Zalando, Munich RE, Continental, Deutsche Post, BMW, E.ON, and Infineon posted losses ranging from 1.5% to 2.5%.
French stocks saw Teleperformance rise nearly 4%. Eurofins Scientific, Safran, LVMH, Vivendi, Schneider Electric, Kering, Pernod Ricard, Danone, Legrand, Accor, and Edenred recorded gains of 1% to 2.2%. Conversely, Renault, Michelin, AXA, Thales, Airbus Group, Societe Generale, Capgemini, and STMicroElectronics booked losses varying in severity.
Economically, the UK's permanent placements and vacancies fell at an accelerated pace in December, as firms assessed the implications of tax increases announced in the October budget, as per a report by S&P Global. The KPMG/REC Report on Jobs survey indicated that permanent placements experienced their steepest decline since August 2023.
Eurostat data revealed that Eurozone retail sales increased by 0.1% in November compared to the previous month and 1.2% year-over-year. Destatis’ provisional data indicated that Germany's industrial output rose by 1.5% month-on-month in November, correcting a revised 0.4% drop in October, whereas analysts had projected a modest 0.5% rise. Compared to November 2023, industrial production contracted by 2.8%, following a 4.2% decline in October.
Germany's exports grew by 2.1% in November, recovering from a 2.9% fall in October, surpassing expectations of a 2% increase. Conversely, imports slipped by 3.3%, worsening from a 0.3% reduction in October, defying forecasts of a 0.7% increase. Consequently, the trade surplus expanded to EUR 19.7 billion in November, up from EUR 13.4 billion in October.
Year-over-year, exports decreased by an unadjusted 6.5%, after a modest 0.4% rise, while imports fell 5.2%, following a 4.3% increase.
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