Most European Stocks Rise as Stoxx 600 Climbs Sixth Week

Most European stocks advanced, with the Stoxx Europe 600 Index rising for a sixth consecutive week, as investors weighed U.S. industrial data to gauge the strength of the world’s largest economy.

Vivendi SA climbed 2.8 percent after posting better-than-estimated third-quarter profit and saying it will spin off its French phone carrier SFR by July 2014. Publicis Groupe SA rose 1.6 percent. Julius Baer Group Ltd. slipped 1.6 percent after reporting that its gross margin narrowed as it absorbed wealth-management units acquired from Bank of America Corp. Safran SA (SAF) lost 3.9 percent as the French state, its largest shareholder, reduced its stake.

The Stoxx 600 added 0.2 percent to 323 at the close of trading, with about three stocks rising for every two that fell. The benchmark gauge rallied the most in almost a month yesterday as Fed chairman nominee Janet Yellen said she is committed to promoting a strong U.S. economic recovery and will ensure monetary stimulus isn’t removed too soon.

“Markets have coped pretty well and investors remain optimistic,” said Michael Morris, head of equities at Mitsubishi UFJ Asset Management in London. “Many investors are saying that markets are fairly valued, though you wonder at what point people will take their money from equities. The Fed under Yellen will be concerned about U.S. economic growth, meaning the likelihood of early tapering seems low.”

The European equity benchmark added 0.1 percent this week. The index has risen for six straight weeks, its longest winning streak in almost 15 months, as the Fed maintained the pace of its bond purchases and the European Central Bank lowered its key interest rate.

National Indexes

National benchmark indexes climbed in 11 of the 18 western European markets today. France’s CAC 40 gained 0.2 percent, the U.K.’s FTSE 100 rose 0.4 percent and Germany’s DAX added 0.2 percent.

The number of shares trading hands on Stoxx 600-listed companies was 15 percent lower than the 30-day average, data compiled by Bloomberg showed.

U.S. data today showed industrial production cooled in October amid a 16-day partial shutdown of the federal government. Output fell 0.1 percent last month, missing the median economist forecast for growth of 0.2 percent, after gaining a revised 0.7 percent in September,

A separate report showed manufacturing in the New York region unexpectedly contracted in November for the first time since May. The Fed Bank of New York’s index fell to minus 2.21, missing the average estimate for a gain to 5. Negative readings signal contraction in New York, northern New Jersey and southern Connecticut.

‘Tough Challenges’

“The real economy in the U.S. has maybe not responded as well as the Fed would have hoped,” Morris said. “Inequality, real wage and income stagnation will remain tough challenges.”

Vivendi gained 2.8 percent to 18.74 euros. The Universal Music Group owner posted profit adjusted for non-recurring elements of 403 million euros ($542 million), beating the 386 million-euro average of estimates compiled by Bloomberg.

Publicis rose 1.6 percent to 63.94 euros after advertising-industry peer WPP Plc denied a U.K. newspaper’s report that it may bid for Interpublic Group of Cos., the second-biggest U.S. ad company. Publicis and Omnicom Group Inc. said in July they would merge, unseating WPP as the world’s largest advertising network.

Koninklijke Boskalis Westminster NV (BOKA) added 1.3 percent to 35.18 euros. The Dutch dredging company raised its full-year net income forecast to at least 360 million euros from a previous estimate of 330 million euros.

Julius Baer

Julius Baer slipped 1.6 percent to 41.84 Swiss francs. The bank’s gross margin, which reflects how much it makes in revenue on managed client assets, dropped to 97 basis points at the end of October from 102 basis points in the first half, according to a statement.

Safran declined 3.9 percent to 46.18 euros as the French government, its biggest stakeholder, sold 19.5 million shares, or a 4.7 percent stake, in the manufacturer. The shares were priced at 46.30 euros, according to terms obtained by Bloomberg News.

Ultra Electronics Holdings Plc dropped 4.2 percent to 1,816 pence, its biggest decline in a year. The U.K. military-electronics maker said that a weak U.S. government-funded market will contribute to a decline in sales this year.

To contact the reporter on this story: Sofia Horta e Costa in London at shortaecosta@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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