A surge in ARM Holdings Plc after a deal announcement pushed chipmakers higher, boosting European equities at the close of a volatile session.
ARM jumped 41 percent to a record after SoftBank Group Corp. agreed to buy the chip designer for 24.3 billion pounds ($32 billion). Peers Dialog Semiconductor Plc and Ams AG advanced more than 4.7 percent, pushing a gauge tracking the region’s technology shares to their biggest surge since last August. Miners erased earlier declines, while energy companies in the Stoxx Europe 600 Index fell as oil slipped.
The market showed resilience after a failed coup in Turkey, with the benchmark gauge for Europe’s stocks adding 0.2 percent at the close of trading in London. Speculation that central banks will limit the fallout of Britain’s vote to leave the European Union has helped the Stoxx 600 rise in two of the past three weeks. It closed 2.2 percent away from its level on the day of the referendum.
“The fact that the coup has failed in Turkey is helping European stocks today, adding to optimism on expectations that the ECB might announce some further easing or call for governments to step up fiscal measures to prop up the economy this week,” said Pierre Mouton, who helps manage about $9 billion at Notz, Stucki & Cie. in Geneva. “We see deals coming more and more and it should last as we see zero to negative interest rates punish cash holdings, ultra low financing costs, healthy balance sheets, rare growth opportunities, and in many cases acceptable valuations.”
The Stoxx 600 earlier erased gains of as much as 0.8 percent, with the volume of shares changing hands about 35 percent lower than the 30-day average. The index traded at 14.9 times estimated earnings, less than the MSCI All-Country World Index’s 15.7 multiple. Economists surveyed by Bloomberg forecast that the European Central Bank will probably keep its policy unchanged at its Thursday meeting.
While the Stoxx 600 hasn’t completely recovered from its Brexit slide, the U.K.’s FTSE 100 Index, helped by a weakening of the pound, closed 5.6 percent above its June 23 level, trading at its highest since August of last year. It rose 0.4 percent on Monday, posting one of the biggest gains among western-European markets.
Among other stocks moving on corporate news, SBM Offshore NV jumped 15 percent after the Dutch oil-services provider signed a leniency agreement with Brazilian authorities following a corruption investigation. Ericsson AB dropped 3.2 percent after newspaper Svenska Dagbladet said the maker of wireless networks may be inflating sales, a report the company refuted. Hapag-Lloyd AG tumbled 8.9 percent as a forecast of lower profit and a share-sale plan overshadowed a final deal to join forces with United Arab Shipping Co. to become the world’s fifth-largest container carrier.
The iShares MSCI Turkey UCITS ETF and Lyxor UCITS ETF Turkey, both listed in western Europe, fell more than 7.5 percent as the nation’s shares declined. President Recep Tayyip Erdogan promised “a new Turkey” after Friday’s failed coup, with power concentrated in the hands of the president and old secular elites having a lesser political role.