European Stocks Climb for Sixth Day; VW, Daimler Lead Gains
Volkswagen AG and Daimler AG led automotive shares higher as 17 of the 19 industry groups in the Stoxx Europe 600 Index gained. Sonova Holding AG (SOON) tumbled 12 percent as its chief executive officer and finance head resigned after an investigation into possible insider trading at the Swiss hearing-aid maker. Dixons Retail Plc (DXNS) sank 18 percent as the U.K. retailer said earnings will miss most estimates.
The Stoxx 600 rose 0.7 percent to 278.55 at the 4:30 p.m. close in London, recouping the losses that followed Japan’s March 11 earthquake and tsunami. The benchmark has gained 6.2 percent since this year’s low on March 16 as investors speculated that Japan will prevent a meltdown at its damaged nuclear power plant and the U.S., U.K. and France began military action in Libya.
“The situations in Japan and the Middle East aren’t going to derail the global recovery or markets,” Larry Kantor, head of research at Barclays Capital, said on Bloomberg Television’s “On the Move” with Francine Lacqua. “Valuations are attractive, and growth, at least in the northern countries, is solid. There’s still some upside.”
National benchmark indexes rose in all of the 18 western European markets, except Greece and Spain. The U.K.’s FTSE 100 gained 0.3 percent and France’s CAC 40 advanced 0.9 percent. Germany’s DAX climbed 1.8 percent.
Companies in the U.S. added more workers in March, a sign the labor market may be strengthening, data from a private report based on payrolls showed today. Employment increased by 201,000 workers in March after a revised 208,000 gain in February, according to figures from ADP Employer Services.
In Libya, rebels were forced to retreat in the face of artillery and rocket fire from government troops defending Sirte, cutting short their advance as foreign ministers from alliance nations met in London to coordinate strategy for driving Muammar Qaddafi from power.
Automotive shares climbed 1.7 percent for the biggest gain among all industry groups in the Stoxx 600. Volkswagen, Europe’s largest carmaker, surged 2.8 percent to 115.30 euros, while Daimler, the world’s biggest truckmaker, gained 3.1 percent to 49.84 euros.
BHP Billiton Ltd. (BHP), the world’s largest mining company, advanced 1.4 percent to 2,449 pence. Vedanta Resources Plc (VED), the largest copper producer in India, rose 3.4 percent to 2,314 pence as Morgan Stanley said the shares have the potential to gain as much as 64 percent.
Bellway Plc (BWY) climbed 4.4 percent to 712 pence, the first advance in four days. The second-worst performing U.K. homebuilder in the past 12 months said first-half profit rose to 18.5 million pounds ($29 million) after the company sold more homes at higher prices.
Tate & Lyle Plc, the maker of the low-calorie sweetener Splenda, advanced 1.9 percent to 559.5 pence. The stock was raised to “buy” from “hold” at Investec Ltd.
Meda AB (MEDAA) rose 3.2 percent to 61.40 kronor as the drugmaker said Trobalt received European approval for epilepsy treatment.
Thomas Cook Group Plc (TCG), Europe’s second-biggest tour operator, surged 5.9 percent to 174.8 pence. Royal Bank of Scotland Group Plc reiterated its “buy” (TATE) recommendation on the stock, saying the shares look inexpensive.
Sonova plunged 12 percent 82.4 Swiss francs after CEO Valentin Chapero and CFO Oliver Walker tendered their resignations and Chairman Andy Rihs stepped down from his post.
An external investigation into share sales by directors and executives before Sonova reduced its profit forecast on March 16 “showed weaknesses in internal processes,” Sonova said. Internal rules were not enforced and the profit warning was published too late, the company said.
Dixons retreated 18 percent to 13.69 pence, the biggest drop since 2008. The U.K.’s largest consumer-electronics retailer said full-year earnings will miss most analysts’ estimates as sales decline because of weakening consumer confidence.
Bank of Ireland Plc sank 9.3 percent to 22.4 euro cents, a two-year low, amid speculation the government may be forced to take a controlling stake after the results of a third round of stress tests are published tomorrow. Irish Life & Permanent Plc, which tumbled 45 percent yesterday, sought a temporary suspension in trading until after the results are revealed.
Marks & Spencer Group Plc, the U.K.’s largest clothing retailer, lost 3 percent to 340.7 pence as the stock was initiated with a “sell” (MKS) recommendation at MF Global.
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