The week from the 12 th to the 16 th February 2018 saw the STOXX 600 rise 3.3%, recovering some of the previous two weeks' losses, as only 46 of the 600 constituents were in the red. Volumes traded remained relatively high, 14.7% above the twelve month average, as volatility rose further (Source: DS 1y measure of volatility). The rise was part of a wider global equity market recovery, with the MSCI World up 4.2% in dollar terms. The STOXX 600 actually posted its best performance in dollar terms (+4.9%) since 2015, as the Euro strengthened against the USD. The greenback fell last week, with its weak performance linked to concerns around its debt, whilst the US appears to be pursuing a weak currency policy and as its yield advantage on other currencies is expected to erode. The best performing indices were in the Nordics, with the OMXH25 up 5.4% and the OMXC20 up 4.9%.
Tech sector continues to outperform
The Tech sector was once again the best performer, up 3.8% through the week, with only one stock in the sector gaining less than 1.7% ( Gemalto , -0.1%). The sector was led by Dassault Systemes (+ 9.3%), recently voted the world's most sustainable company (Source: Corporate Knights), with Logitech , which recently upped its outlook after a record Xmas, gaining 8.0%.
Media sector representing companies at the extremes
The media sector accounted for both the best performing and the worst performing stocks on the index. Leading the sector WPP gained 14.8%. The British advertising company was supported by positive broker coverage, as Dentsu in Japan posted positive numbers and US peer Omnicon posted positive guidance. Also in the media sector, satellite maker Eutelsat Communications shares were up 11.3% after the satellite operator posted first-half results and confirmed its financial objectives for its fiscal year. SES FDR , another satellite operator was the worst performing stock on the index, down 8.4%.
Some more positive data in the Eurozone :
Last week saw the release of some more positive macro data in the Eurozone, as Industrial production rose by more than expected in December, up 5.2% YoY (expectations of 4.2%). Further, France's unemployment rate fell to its lowest since 2009, to 8.9%. The CAC 40 was up 4.0%, the third best performing European index.
Airbus shares soared 14.4% after the European aircraft maker beat profit and earnings expectations with deliveries hitting a record high in 2017 and Emirates committing to buy at least 20 of the flagship A380 superjumbo, keeping the plane in production for another decade. Though it booked a new €1.3bn charge on its A400M military plane.
Ipsen jumped % after the reported strong full-year results notably with a 74.5% increase in revenues from North America driven by continued growth of neuroendocrine tumors treatment Somatuline. The French pharma company's chief executive said the firm has around $1.25bn for asset purchases.
TDC surged 12.9% after the Telecom operator scrapped plans to merge with Sweden's Modern Times Group and accepted an improved $6.6bn takeover offer from three Danish pension funds and Australian infrastructure investor, capping a flurry of news involving Nordic media and mobile groups.
Telenet shares fell 6.4% on dividend concerns after the Belgian operator posted muted growth in Q4 2017 revenues.
- 20.02.2018: German consumer confidence; ZEW economic indicator; Eurozone consumer confidence
- 21.02.2018: France, Germany, Eurozone PMI; UK U/E data; FOMC minutes
- 23.02: UK GDP
- 24.02: Eurozone CPI
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