European Stocks Rise on German GDP Report
European stocks gained, rebounding from a two-day decline, as a report showed German growth slowed less than forecast, while minutes revealed that several Bank of Japan policy makers are prepared to stimulate the economy.
Standard Life Plc (SL/) rallied 8.1 percent as first-half profit at Scotland’s biggest insurer rose 15 percent. A.P. Moeller- Maersk A/S advanced 3.2 percent after increasing the full-year forecast for its container-shipping unit. CRH Plc (CRH) plunged 4.8 percent after saying a European sales decline will worsen.
The Stoxx Europe 600 Index (SXXP) gained 0.7 percent to 270.54 at the close. The gauge has rallied 16 percent from this year’s low on June 4 as European Central Bank President Mario Draghi said that he will do anything to protect the 17-nation currency.
“While not great in any way, German and French GDP numbers were better than expected, which adds to the scenario that there is no risk of an imminent euro break up,” said Alexander Kraemer, a cross-asset strategist at Commerzbank AG in Frankfurt. “It shows global growth is not collapsing, which also helps reduce investment risks.”
The volume of shares changing hands in companies listed on the Stoxx 600 was 35 percent lower than the average of the last 30 days, according to data compiled by Bloomberg.
Germany’s economic growth slowed less in the second quarter than economists had forecast as exports and household spending helped to fend off the impact of the sovereign-debt crisis on Europe’s largest economy.
Gross domestic product rose 0.3 percent from the first quarter, the Federal Statistics Office said in Wiesbaden today. Economists had predicted a 0.2 percent increase, according to the median of 40 estimates in a Bloomberg News survey.
France’s GDP was unchanged in the quarter, better than the 0.1 percent decline that economists had predicted. The euro-area economy as a whole contracted 0.2 percent in the three months to the end of June. That matched estimates.
National benchmark indexes advanced in 15 of the 18 western-European markets today. The U.K.’s FTSE 100 gained 0.6 percent, while Germany’s DAX rose 0.9 percent. France’s CAC 40 added 0.7 percent. Ireland’s ISEQ Index slid 1.1 percent.
In Tokyo, minutes of the BOJ’s last meeting showed several board members said the central bank should not dismiss any policy options in combating risks to the economy.
“A few members said that Japan’s economy could be adversely affected through various channels if, for example, a substantial risk materialized, stemming from the European debt problem,” the bank said in the minutes of the July 11-12 meeting. “These members continued that the bank should therefore stand ready to take appropriate actions without ruling out any options in advance.”
A U.S. Commerce Department release showed that retail sales rose in July more than economists had predicted. They climbed 0.8 percent, their first advance in four months, exceeding the 0.3 percent median estimate of economists polled by Bloomberg. A report tomorrow may show output at U.S. factories, mines and utilities climbed 0.5 percent in July. It increased 0.4 percent in June.
Standard Life surged 8.1 percent to 277.4 pence as operating profit climbed to 302 million pounds ($474 million) from 262 million pounds a year earlier. That beat the 263 million-pound median prediction of six analysts surveyed by Bloomberg due to increased sales of fee-based savings products and lower acquisition costs.
“We are well prepared for the regulatory and market changes on the horizon, and have invested to make sure we are even better placed to meet the needs of our customers and their advisers,” Chief Executive Officer David Nish said.
Maersk advanced 3.2 percent to 41,880 kroner after reporting that its container business, the world’s largest, returned to profit in the second quarter as freight rates jumped. The company predicted a modest full-year profit for the unit. It had projected a “negative to neutral” result.
Aker Solutions ASA (AKSO) climbed 5.7 percent to 101.50 kroner. The Norwegian oil-services company reported second-quarter profit and sales that beat estimates.
Galp Energia SGPS SA (GALP) rose 1.3 percent to 11.72 euros after Portugal’s biggest oil producer said tests confirmed the presence of good quality crude at a well off the coast of Brazil known as Carcara. Galp holds a 14 percent stake in the consortium exploring the Carcara well.
CRH slid 4.8 percent to 14.76 euros in Dublin after the building-materials group said that comparable sales will drop more than 5 percent in the second half of this year.
Hochtief AG (HOT) declined 2.3 percent to 40 euros as Germany’s largest builder said that its profit targets for the year have become more challenging. The company set aside money for a delayed concert-hall project. It posted a second-quarter net loss of 15 million euros.
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