European Stocks Rise as Fed Chair’s Comments Excite Investors

By Investors Hub

European stocks have gained ground on Wednesday as Federal Reserve Chair Jerome Powell’s upbeat economic view bolstered investor confidence in the world’s largest economy.

While the French CAC 40 Index has risen by 0.4 percent, the U.K.?s FTSE 100 Index and the German DAX Index are both up by 0.6 percent.

The British pound drifted lower to hit its lowest level in 10 months after U.K. inflation data missed forecasts.

The consumer price index unexpectedly came in flat at 2.4 percent year-over-year versus expectations for a 2.6 percent increase, raising questions over whether the Bank of England will deliver an August rate hike.

Elsewhere, final data from Eurostat showed Eurozone annual inflation accelerated in June, exceeding the European Central Bank’s target of “below, but close to 2 percent”.

The annual inflation rate rose to 2 percent from 1.9 percent in May, in line with the flash estimate released on June 29.

Novartis has moved notably higher after the Swiss drug major reiterated its full year outlook after reporting a surge in second quarter profits.

Telecommunications equipment company Ericsson has soared after swinging to a modest operating profit in the second quarter and pledging to deliver an operating margin of 10 percent by 2020.

ASML Holding has jumped as its second quarter earnings topped forecasts. Airline EasyJet has also rallied after lifting its full-year profit forecast.

On the flip side, Danish lender Danske Bank has tumbled after warning its 2018 earnings will be at the lower end of its previous guidance.

Electrolux has also dropped after its second quarter net income declined to 517 million Swedish kronor from 1.29 billion kronor in the year-ago quarter due to provisions related to a French competition probe.

Shares of Smiths Group have also slumped. The British engineering company warned that it expects a 2 percent drop in full-year revenue at its medical division.

Additionally, Premier Foods has tumbled after announcing it is considering selling some brands as part of turnaround plans.