FRANKFURT: European stocks rose for the fourth time in five days as speculation central banks will take further steps to support the economic recovery outweighed the biggest contraction in U.K. manufacturing for three years.
Next Plc jumped 7.2% as the retailer increased its annual profit forecast after reporting first-half sales that rose more than analysts estimated. Arkema SA climbed 5.3% as second-quarter earnings beat projections. Mediaset SpA dropped 10% after profit declined 65 percent amid lower advertising sales.
The Stoxx Europe 600 Index (SXXP) gained 0.4 percent to 262.41 at 3:07 p.m. in London. The benchmark measure has rallied 12 percent from this year’s low on June 4 as German Chancellor Angela Merkel and French President Francois Hollande last week joined European Central Bank President Mario Draghi in promising to do everything to protect the euro.
“Markets are clearly being driven by the expectation of further central-bank intervention,” said Peter Garnry, an equity strategist at Saxo Bank A/S in Copenhagen. “Everyone is expecting Draghi to launch another round of secondary-market purchases to get yields on Spanish and Italian bonds lower.”
Benchmark indexes rose in eight of the 17 western European markets open today. The U.K.’s FTSE 100 (UKX) gained 1 percent while Germany’s DAX slipped 0.2 percent. Markets in Switzerland were closed for a holiday.
The number of shares changing hands in Stoxx 600 companies was 32 percent lower than the 30-day average, according to data compiled by Bloomberg. (Bloomberg/tw)