European Stock Markets Rise, Issuer Profits Support
European stock markets closed higher on Wednesday (July 22nd), supported by solid issuer financial reports despite a still-pressuring macroeconomic backdrop. The Euro STOXX 50 rose 0.5% to 6,319, while the STOXX Europe 600 gained 0.6% to 647.
The banking sector was one of the market's main drivers. Santander rose 1.7% after reporting a 17% increase in annual underlying profit, supported by customer growth following its acquisition of British bank TSB.
Shares of other banks also rallied after positive financial sector results. BBVA rose 2%, Intesa Sanpaolo gained 1.3%, and UniCredit added 0.7% ahead of its earnings release on Thursday.
Outside the banking sector, Airbus surged 7% after raising its aircraft delivery target and announcing a €5 billion share buyback program. This news bolstered investor interest in major European industrial stocks.
However, macroeconomic pressures remain persistent. Government bond yields remain near new highs, while natural gas prices continue to soar. This could re-increase inflation concerns and limit the scope for monetary policy easing.
Impacting the market, the strengthening of European stock markets indicates investors remain focused on the solid performance of issuers. However, the ECB meeting on Thursday remains a key focus. If the ECB holds interest rates but signals a hawkish stance due to the risk of energy inflation, the European stock rally could be restrained, especially in sectors sensitive to funding costs.
Source: Newsmaker.id
