European Stocks Rise, Index Set for Best Month Since 2023
European stocks rose, with benchmarks on track for their best month in a year, on solid earnings and speculation the region will avoid direct U.S. tariffs.
The Stoxx Europe 600 Index rose 0.3% as of 8:10 a.m. in London. The gauge has advanced for six straight weeks and posted a 6.4% gain for January so far, its best performance since November 2023. The gauge got a boost as investors flocked to cheaper stocks and doubts grew about the lofty valuations of artificial intelligence players such as Nvidia Corp.
Atoss Software SE rose 5.1% after reporting earnings that beat analysts’ average estimate. Novartis AG shares rose 2.9% after the company said profit would rise this year as new drugs help offset competition from copycats of its best-selling drug. “The market has taken a positive bias on European equities,” said Thomas Brenier, head of equities at Lazard Freres Gestion. “Investors seem optimistic about the economic cycle and the DeepSeek fear could slow the flow of capital to US big tech that benefits Europe.” “We are sticking to our positive view on European equities, we think US rates are overstated and I believe they can adapt quite easily to these constraints,” Brenier added. On Thursday, the European Central Bank lowered borrowing costs for the fifth time since June, with the region’s economy stalling and its 2% inflation target within reach.
There is still uncertainty about the ECB’s policy trajectory in 2025. “What’s tricky for investors is that the ECB’s ‘data-dependent’ stance gives investors little visibility,” said Florent Wabont, market economist at asset manager Ecofi. “We will probably have another rate cut in March and maybe in April, but the end point — it’s less aggressive.”
Source: Bloomberg
