Breaking News
Investing Pro 0
🚨 Our Pro Data Reveals the True Winner of Earnings Season Access Data

European stocks rise as earnings offset economic gloom

Economy Oct 25, 2022 04:41AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, September 22, 2022. REUTERS/Staff
 
LOGI
-1.99%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
STOXX
-0.69%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Sruthi Shankar

(Reuters) -European stocks rose on Tuesday after a slew of better-than-expected earnings reports helped offset worries about fast rising interest rates and a slowing euro zone economy.

The pan-European STOXX 600 index rose 0.3%, with financial services and technology stocks countering losses in chemical firms.

Boosting financial stocks, UBS climbed 5.6% after the Swiss bank beat market expectations for quarterly profit due to a rise in new money inflows.

SAP gained 4.1% after the German business software maker reported faster-than-expected revenue growth for the third quarter, while Logitech (NASDAQ:LOGI) International rose 6.4% after the computer peripherals maker reaffirmed its full-year forecast.

Overall, the quarterly updates helped lift sentiment despite lingering worries about a European recession as consumers and businesses buckle under pressure from surging inflation and higher borrowing costs to tame it.

Earnings from tech giants Microsoft Corp (NASDAQ:MSFT), Google-owner Alphabet (NASDAQ:GOOGL) Inc and Apple Inc (NASDAQ:AAPL) will set the tone on Wall Street this week.

"Our focus is on the forward outlook for Q4 and 2023 EPS, which has now started to fall, even though we believe it still to be at optimistic levels and thus subject to further cuts as companies report," said Leonardo Pellandini, equity strategist at Julius Baer.

"We reiterate our defensive positioning for the time being given the imminent slowdown in macroeconomic momentum."

Of the 20% of STOXX 600 companies that have reported third-quarter results so far, 55% have beat analysts' profit estimates, as per Refinitiv IBES data. In a typical quarter, 53% top estimates.

While European corporate earnings are expected to grow 28.4% in the third quarter, it is seen up 18.2% in the fourth quarter and just 3.1% in the first quarter of 2023.

The European Central Bank (ECB) is widely expected to deliver a second straight 75 basis point rate hike this week, but a recent report suggesting the U.S. Federal Reserve might slow its pace of rate hikes has raised hopes of a pivot from the ECB too.

Among decliners, German chemicals maker Covestro fell 2.8% after it cut its 2022 earnings outlook for the third time this year, blaming high gas and raw material prices amid the deepening European energy crisis.

German sportswear maker Adidas (OTC:ADDYY) dropped 3.1% after Morgan Stanley (NYSE:MS) downgraded its stock to "underweight" from "equal weight". Separately, Bloomberg reported the company is set to cut ties with American rapper Kanye West amid controversies.

European stocks rise as earnings offset economic gloom
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Ricardo Diogo
Rcd72 Oct 25, 2022 3:49AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
absolutely pathetic .... sentiment is more of getting drunk before the wave hits
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email