By Dow Jones Business News,
January 17, 2014, 11:58:00 AM EDT
By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- European stock markets showed broad-based gains on Friday and scored solid weekly advances
after U.K. retail sales jumped more than expected and mining firms continued to rise after a broker upgrade the prior
The Stoxx Europe 600 index added 0.6% to close at 335.82, ending the week 1.8% higher.
James Ashley, chief European economist at RBC Capital Markets, said the stock markets could have more gains in store
as the global economy, including the outlook in Europe, improves.
"2013 was a year of transition and 2014 will be a year of stabilization. For the euro zone, we are expecting growth of
around 1%. That's by no means a strong growth rate, but it's stronger than what we have had in a good couple of years,
so we are heading in the right direction," he said.
"Equity markets have some basic relation to economic fundamentals and as the fundamentals start to improve, we should
start to see that on corporate results. There is a clear connection between those, so at some point it should start to
filter through, but it could be more a story for later in 2014," he added.
In corporate news on Friday, shares of Royal Dutch Shell PLC (RDSB) lost 1.2% after the energy giant warned profit in
the fourth quarter is expected to be "significantly lower than recent levels", partly due to current oil and gas prices.
Another oil major, Total SA ( TOT ), added 0.9% after Citigroup lifted the French firm to buy from neutral.
Pandora AS climbed 2.8% after the Danish jewelry firm said sales in 2013 rose more than anticipated after a better-
than-expected holiday period and a string of store openings.
More broadly, the major indexes took a firm leg up in midmorning trade after the U.K. Office for National Statistics
said retail sales jumped 2.6% in December over November, beating analysts' forecast of a 0.2% rise. That was the biggest
month-on-month rise since February 2010.
"Despite all the noises about a questionable Christmas, U.K. consumers seem to have their mojo back," said Rob Wood,
chief U.K. economist at Berenberg, in a note.
He cautioned, however, that the December surge follows two weak months and that Christmas sales tend to be volatile
from year to year.
"So it would be worth waiting for the January figures before concluding consumer sentiment is quite as strong as these
growth rates signal," Wood said.
The U.K.'sFTSE 100 index inched 0.2% higher to 6,829.30, weighed by the loss for Royal Dutch Shell. On the week, the
benchmark climbed 1.3%.
Mining firms rose in London, adding to gains seen on Thursday when Citigroup went bullish on the sector for the first
time in three years. Shares of Glencore Xstrata PLC (GLCNF) added 3.4%, Rio Tinto PLC (RIO) put on 1.5% and BHP
Billiton PLC ( BHP ) gained 1.6%.
Germany's DAX 30 index rose 0.3% to 9,742.96, ending 2.9% higher on the week. France's CAC 40 index put on 0.2% to
4,327.50 and closed out the week 1.8% higher.
In the U.S., markets were mixed as results from Intel Corp. ( INTC ) and United Parcel Service Inc. (UPS) added pressure
on indexes and consumer sentiment data unexpectedly fell in January.
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