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European Stocks Edge Higher; Richemont Shines After Quarterly Report

Stock MarketsJul 16, 2021 03:55AM ET
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© Reuters.

By Peter Nurse 

Investing.com - European stock markets traded higher Friday, stabilizing after the previous session’s sharp Covid-inspired losses with investors focusing on corporate earnings and the latest Eurozone inflation data.

At 3:55 AM ET (0855 GMT), the DAX in Germany traded 0.2% higher, the CAC 40 in France rose 0.2% and the U.K.’s FTSE 100 climbed 0.6%.

The quarterly earnings season is kicking into full gear in Europe, and investors are expecting improvements as the continent reopens from the restrictions imposed to combat the pandemic.

Richemont (SIX:CFR) stock rose 2% after the luxury goods retailer reported its sales more than doubled in the three months to June 30, helped by a strong performance in the Americas from its jewellery brands.

German footwear retailer Puma (DE:PUMG) raised its 2021 sales outlook, boosted by strong second quarter demand, especially in North America. However, its stock fell 1.1% with investors seemingly wanting more. 

It was a similar story with Burberry (LON:BRBY), as the luxury fashion house reported that its like-for-like sales had risen above pre-pandemic levels for the 13 weeks to June 26, yet its stock fell 2.3%.

Ericsson (BS:ERICAs) stock slumped almost 10% with the Swedish telecommunications company reporting a sales drop in the important Chinese market, overshadowing a $8.3 billion multi-year 5G deal with U.S. giant Verizon Communications (NYSE:VZ).

Investors will also keep a close eye on the release of the latest consumer price inflation data from the Eurozone, ahead of next week’s policy-setting meeting by the European Central Bank.

The June CPI release, due at 5 AM ET (0900 GMT), is expected to see the annual figure fall back to +1.9%, dropping below the bank’s 2% target.

European markets struggled on Thursday, with the main indices all dropping around 1%, weighed down by concerns that rising Covid cases will stunt global growth just as central banks start to fret about soaring inflation. 

Earlier Friday, the Bank of Japan downgraded its real GDP forecast for 2021 while keeping its monetary policy unchanged, now expecting growth of 3.8% compared with the 4.0% forecast it made in April.  

Elsewhere, oil prices slipped marginally lower Friday, heading towards their worst week since mid-March on worries that the surge in new Covid-19 cases globally will hit demand, while the likelihood of a new OPEC+ production deal may lift supply at the same time.

At 3:55 AM ET, U.S. crude futures traded 0.1% lower at $71.62 a barrel, on course to fall almost 4% this week, while the Brent contract fell 0.1% to $73.44, set to drop almost 3% this week.

Additionally, gold futures fell 0.3% to $1,823.55/oz, heading for its fourth consecutive weekly gain, while EUR/USD traded 0.1% lower at 1.1802.

 

European Stocks Edge Higher; Richemont Shines After Quarterly Report
 

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