European Stocks Head for Muted Finish to November; Puma Rallies
European stocks edged higher on Thursday and were set to close November with a small gain, while Puma SE surged on chatter around a takeover.
The Stoxx Europe 600 Index was up 0.1% at the close. Puma jumped 19%, the most in over two decades, as Bloomberg News reported Chinese sports apparel company Anta Sports Products Ltd. was among firms exploring a potential takeover of the German company.
Financial service and auto stocks outperformed, while technology and health care were the biggest decliners. Trading volumes on the Stoxx 600 were notably below the 30-day average with US markets closed for the Thanksgiving holiday.
“We’re building up for a classic year-end rally,” said Daniel Murray, deputy chief investment officer and global head of research at EFG Asset Management. “People still want to finish the year on a high note, and any pullback will still be bought by investors that remain underweight.”
European stocks have rebounded this week after global financial markets wobbled on worries about high technology valuations and an uncertain US monetary policy outlook. The Stoxx 600 has now recouped its November declines, and is heading for a fifth straight month of gains.
Some technical indicators suggest there’s room for the rally to extend after the Stoxx 600 held critical support levels in the pullback. Still, those levels need to be resilient in the event of fresh declines, or there’s a risk that systematic strategies will trigger another heavy selling episode.
In the UK, the domestic-focused FTSE 250 index rose 0.9%, although bonds and the pound pulled back after rallying in the previous session on Chancellor Rachel Reeves’s budget.
“Coming hot off the heels of a budget that undoubtedly hit working people despite pre-election promises, there is a feeling that we have finally overcome a hurdle that has been looming large over the UK economy and markets for months,” said Joshua Mahony, chief market analyst at Scope Markets.
Source : Bloomberg.com
