European Stocks Hold Near Record High as Investors Eye Economic Data, Oil Prices
Market Overview and Key Drivers
By Tharuniyaa Lakshmi, Ragini Mathur and Utkarsh Hathi
Aug 10 (Reuters) - Europe's benchmark stock index held near a record high on Monday as investors paused ahead of a week packed with economic data, while uncertainty surrounding the Middle East conflict kept oil prices elevated.
Performance of Major Indices and Sectors
The pan-European STOXX 600 was little changed at 660.45 points. The energy sector led gains, rising 1.3%, as oil prices climbed for a fourth straight session.
Impact of Geopolitical Tensions on Oil Prices
Iran said the U.S. must meet several conditions before it reopens the Strait of Hormuz, while signalling it was close to an agreement with Oman on new shipping lanes through the waterway. The strait is a critical energy corridor for Europe.
Investor Sentiment and Economic Data
"Markets are really just in a period of digestion and wait-and-see," said Kiran Ganesh, managing director, global head of investment communications at UBS.
Investors are also focused on euro zone employment data and U.S. consumer price figures due later this week for clues on the outlook for interest rates.
Recent Market Movements and Earnings
Softer-than-expected U.S. jobs data last week and strong corporate earnings on both sides of the Atlantic helped lift the STOXX 600 1.7% to a record high on Friday.
Corporate Earnings Insights
"Looking at corporate earnings, neither the crisis (in Middle East), nor tariffs, nor overshooting chip prices have derailed companies from doing good business," said Ipek Ozkardeskaya, senior analyst at Swissquote.
Sector Performance Breakdown
The basic resources sector rose 0.9%, tracking firmer copper and precious metal prices, while technology shares gained 0.3%.
By contrast, the telecoms sector was the biggest decliner, falling 2.1%, as Deutsche Telekom and Vodafone slipped 3.2% and 3.1%, respectively.
Media stocks fell 1.6%, with Britain's biggest advertising group WPP down 5% and French rival Publicis Group losing 1.4%.
Outlook for Earnings Season
With the earnings season nearing an end, LSEG estimates show second-quarter STOXX 600 earnings are expected to rise nearly 21%, up from forecasts of about 12.5% in early May.
Company-Specific Highlights
Plus500 rose 2.1% after the trading platform reported higher half-year core profit, helped by increased trading activity as it expanded in the U.S. and rolled out more products.
Vistry dropped 12.2% after the Financial Times reported credit insurer Allianz was cutting cover for the affordable homebuilder's suppliers by up to 70%.
Coca-Cola HBC fell 4.8% after BNP Paribas cut its rating on the bottler to "neutral" from "outperform".
Additional Information
($1 = 0.8659 euros)
(Reporting by Tharuniyaa Lakshmi, Ragini Mathur, and Utkarsh Hathi in Bengaluru. Editing by Harikrishnan Nair and Mark Potter)
