European Stocks Post Weekly Gain on ECB, U.S. Jobs Report

Stocks in Europe rebounded this week from their worst start to a year since 2010 as European Central Bank President Mario Draghi pledged action if money-market turbulence resumes and investors weighed a U.S. jobs report.

Ryanair Holdings Plc (RYA) added 14 percent after saying more people have booked flights for the summer than at this stage last year. Sky Deutschland AG (SKYD) rose 14 percent after reporting earnings that beat analysts’ expectations. Dassault Systemes (DSY) SA slumped 8.6 percent after predicting 2014 earnings will be lower than analysts’ projections.

The Stoxx 600 rose 0.8 percent to 325.09 this week. The benchmark gauge has lost 3.3 percent from a six-year high on Jan. 22 amid signs of slowing economic growth in China, reduced stimulus from the Federal Reserve and as the Argentinian government’s decision to allow the peso to devalue triggered a rout in emerging-market currencies.

“People are still optimistic,” said Craig Erlam, a London-based market analyst at Alpari U.K. Ltd., a provider of trading services in equities, currencies and commodities. “Europe is unique right now. Once money starts to pour out of emerging markets, investors will be looking at where to get the best yield, especially in an environment that looks relatively safe.”

U.S. payrolls increased by 113,000 in January, following a revised 75,000 gain in December, Labor Department figures showed. The median forecast of economists in a Bloomberg survey called for a 180,000 advance. The jobless rate fell to 6.6 percent, the lowest level since October 2008.

ECB Decision

The Stoxx 600 jumped 1.5 percent on Feb. 6, the most since Dec. 19, after the ECB kept its key interest rate at 0.25 percent and Draghi reiterated that the bank will take action if the outlook for inflation worsens or money-market turbulence resumes.

National benchmark indexes increased in all 18 western-European markets except Germany this week. The U.K.’s FTSE 100 added 0.9 percent, France’s CAC 40 rose 1.5 percent, while Germany’s DAX lost 0.1 percent.

Ryanair Holdings (RYA) rallied 14 percent. Europe’s largest discount airline said that non-ticket sales, which include charges for reserved seating and priority boarding, rose 13 percent in the quarter through December, even as it posted a 35.2 million-euro ($47.9 million) loss from fare competition.

Sky Deutschland rose 14 percent. The company posted 2013 earnings before interest, taxes, depreciation and amortization of 34.8 million euros, saying that more subscribers paid for its television channels. That beat the average analyst projection for 33.7 million euros. The pay-TV operator forecast subscriber growth of as much as 450,000 in 2014.

Alcatel-Lucent Gains

Alcatel-Lucent SA (ALU) added 9.2 percent after posting its first quarterly profit in two years. The French network supplier said net income was 134 million euros as its operating margin widened by 5 percentage points to 7.8 percent. The company said China Huaxin made an offer for its enterprise business.

Pohjola Bank Plc (POH1S) surged 15 percent. Finland’s OP-Pohjola Group offered to buy the remaining part of its publicly-traded subsidiary for 16.80 euros a share. OP-Pohjola already holds 37 percent of Pohjola Bank’s share capital.

Dassault Systemes slumped 8.6 percent. The French developer of 3D-design software also reported fourth-quarter sales of 566 million euros, falling short of the 568 million euros estimated by analysts.

Serco Group Plc (SRP) fell 9.4 percent. Britain’s largest government outsourcing provider said adjusted operating profit for 2014 may be 10 percent to 20 percent lower than the average analyst estimate, even as it announced that it is now eligible again to bid for state contracts.

Hargreaves Lansdown Plc (HL/) declined 9 percent. The U.K’s largest retail broker said its operating margin, a measure of profitability, fell to 65.2 percent for the six months through Dec. 31 from 65.6 percent a year earlier.

To contact the reporter on this story: Trista Kelley in London at tkelley2@bloomberg.net

To contact the editor responsible for this story: Cecile Vannucci at cvannucci1@bloomberg.net

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