Europe stocks buoyed by China data, earnings
MADRID (MarketWatch) -- Europe's benchmark stock index eked out a fifth consecutive day of gains on Thursday, finding support from Chinese economic data and well-received results from heavyweights Novo Nordisk AS and Nestlé SA.
The Stoxx Europe 600 index (SXXP) rose 0.4% to close at 270.26 after posting a 0.2% gain on Wednesday.
The drug and diversified food sectors led the way to gains, while telecoms pushed on the downside.
Doing some heavy lifting for the Stoxx 600, Novo Nordisk (NVO) (NOVOB) shares rose 1.3% after the insulin maker lifted its full-year earnings and sales guidance and posted a 29% rise in second-quarter net profit. Read: Novo Nordisk lifts guidance as results beat views.
Fellow heavyweight Nestlé SA (NSRGY) (NESN) also helped out, rising 2.3% after the food and nutrition group maintained its outlook for the year and reported a stronger-than-forecast 8.9% rise in first-half net profit. But Nestlé also warned of a slowdown in the U.S. market. See: Nestlé warns of U.S. slowdown, earnings beat views.
The results provided momentum for a market awash in trader vacations and low volume. Novo Nordisk and Nestlé also represented blips on the landscape of a largely unimpressive second-quarter earnings season in Europe.
"The performance here is that Nestlé slightly accelerated its volume growth in the second quarter, a unique result in the sector," said analysts at Vontobel Research in a note, who added that the food major also reported growth in troubled European countries, including Spain, Portugal, Italy and Greece.
Also providing some support, China data showed an easing in price pressures as well as slowing industrial production and retail sales, which analysts said opened the door for Beijing to further loosen monetary policy. Read: China data point to slowdown, need for easing.
"It's good if China eases because then, most likely, growth prospects will go higher for China and subsequently for the world and risk will be on, because if China eases, demand goes higher and commodities demand goes higher," said Christian Tegllund Blaabjerg, chief economist at FIH Erhvervsbank.
"Once China steps on the pedal, markets across the world will say 'This is good for the world.' We need China to drag the world out of its misery," Blaabjerg said. But he doesn't expect that to happen until September, along with expected policy easing from the U.S. Federal Reserve.
For now, he said, markets are stuck in range-trading, which is likely to carry on through the month of August.
German stocks lag
Germany's DAX 30 (DAX) ended the day down 1.16 points, or less than 0.1%, at 6,964.99.
On the downside, shares of
The French CAC 40 index (PX1) rose 0.5% to 3,456.71. Utility
In the same sector, shares of E.ON AG (EOAN) slipped 0.4% in Frankfurt.
Shares of luxury-goods group LVMH Moët Hennessy Louis Vuitton SA (MC) rose 2.8%.
In London, the FTSE 100 index (UKX) (UKX) (UKX) gained 0.1% to end at 5,851.51, supported by a 3.6% gain for