European Stocks Edge Higher Before Macro Data; Siemens Gains

European stocks were slightly higher on Thursday, as investors awaited the region’s third-quarter GDP data, with gains for large cap stocks including Siemens AG and ASML NV boosting the gauge.

Author of the article:

Bloomberg News

Julien Ponthus

Published Nov 14, 2024  •  2 minute read

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(Bloomberg) — European stocks were slightly higher on Thursday, as investors awaited the region’s third-quarter GDP data, with gains for large cap stocks including Siemens AG and ASML NV boosting the gauge.

The Stoxx Europe 600 Index gained 0.2% at 9:19 a.m. in Paris, with telecoms and energy stocks outperforming and the consumer products group lagging. Shares in German industrial giant Siemens jumped after it gave a positive forecast for revenue growth in the coming year amid data center demand. ASML rose after it reaffirmed its bullish long-term revenue outlook amid an artificial intelligence-driven boom in semiconductor demand.

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Among other single stocks, shares in Banca Monte dei Paschi di Siena SpA soared after Giorgia Meloni’s government sold a minority stake to rival Banco BPM SpA, while Polish e-commerce firm Allegro.eu SA slumped after reporting results.

Europe’s benchmark index has been falling since Donald Trump won the US presidential election last week, with his America-first policies widely expected to hurt markets outside the US with fresh trade tariffs while boosting US stocks with tax cuts and deregulation.

“There is indeed a rotation going on,” said Raphael Thuin, head of capital market strategies at Tikehau Capital. Investors are “repositioning in the US to the detriment of Europe, triggering dislocation.”

The Stoxx 600 has trailed the S&P 500 this year by the most in at least 24 years in dollar terms, and some investors expect the gap to remain wide.

Traders will be looking at the latest data for euro zone economic growth this morning as a growing number of strategists see Europe’s tepid macroeconomic backdrop as another incentive to dump European stocks.

Also coming up is US producer price data, which is expected to show headline and core producer prices for October rose year-over-year. On Wednesday, US consumer price data came in line with expectations.

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Thuin said that the economic cycle may tip into Europe’s favor moving into 2025 and, provided that China succeeds in propping up its economy, the current low valuation of European stocks should provide an interesting entry point for contrarian investors.

Over in the US, Several US Federal members including Chair Jerome Powell are expected to speak later on Thursday after several officials recently expressed their doubts over how far the central bank will need to lower interest rates. 

For more on equity markets:

• Europe Lags Behind US Rally at Historic Levels: Taking Stock
• M&A Watch Europe: Paschi, BPM, Barclays, Embracer, Worldline
• China Firms Eye Frankfurt for Europe Listings Revival: ECM Watch
• US Stock Futures Unchanged; Dlocal, NextNav, Beazer Homes Gain
• Thames Gets Class A Nod: The London Rush

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