European Markets Extend Weekly Gains, Euro Hovers Near 8-month High

Bridgette Randall
21 Aug, 2024
London

Major stock markets across Europe advanced and extended gains for the third week in a row and erased losses booked earlier in the month. 

Benchmark indexes in London, Paris, and Frankfurt inched higher amid optimism that central banks in Europe and in the U.S. are ready to cut interest rates next month. 

The rate-cut expectations have bolstered market sentiment over the last two weeks following a string of positive updates on inflation in Europe and improving retail sales, labor market, and inflation indicators in the U.S. 

Natural gas prices weakened slightly after gas storage levels reached 90% capacity as Norway prepares for heavy maintenance over the next few weeks. 

 

Europe Indexes and Yields

The DAX index increased by 0.5% to 18,443.66; the CAC-40 index rose by 0.4% to 7,518.40; and the FTSE 100 index advanced by 0.2% to 8,287.88. 

The yield on 10-year German bonds edged lower to 2.22%, French bonds inched down to 2.94%, the UK gilts edged higher to 3.92%, and Italian bonds inched up to 3.59%.

The euro edged down to $1.11; the British pound inched higher to $1.30; and the U.S. dollar weakened to 85.49 Swiss cents.

Brent crude decreased $0.23 to $77.48 a barrel, and the Dutch TTF natural gas rose by €0.54 to €37.58 per MWh.

 

Europe Stock Movers

Mining companies in London advanced after aluminum futures in Shanghai rose to a five-week high amid tight supplies. 

Glencore increased 1.1% to 414.51 pence, Anglo American jumped 2% to 2,291.0 pence, and Antofagasta added 1.5% to 1,908.0 pence. 

Barratt Developments decreased 0.5% to 546.40 pence after the UK's Competition and Markets Authority signaled its willingness to accept measures proposed by the company and Redrow to alleviate local competition concerns. 

Costain Group PLC jumped 5.1% to 99.40 pence, and the UK-based construction and engineering company announced strong first-half results and a stock repurchase plan of £10 million. 

Alcon AG decreased 1.8% to CHF 81.18 after the Swiss pharmaceutical and medical device company for eyecare reported weaker-than-expected second quarter results.