European Stocks Climb as Investors Weigh U.S. DataNamitha Jagadeesh
European stocks advanced for the first time in four days as investors weighed data that showed U.S. services-industries growth accelerated while employers in the world’s largest economy hired fewer workers than estimated.
GlaxoSmithKline Plc gained 1.6 percent after saying it expects revenue and profit to increase this year. Swatch Group AG rose 3.9 percent after posting full-year earnings that beat projections. Svenska Handelsbanken AB jumped 3 percent after announcing a special dividend that boosted its annual payout by 53 percent. Hargreaves Lansdown Plc plunged the most since August 2011 after saying profit margin fell in its first half.
The Stoxx Europe 600 Index added 0.1 percent to 318.04 at the close. The gauge declined 5.5 percent from a Jan. 22 high through yesterday as the Federal Reserve announced the second installment of a reduction in monthly bond purchases and emerging-market currencies tumbled.
“The European economy has only just started a recovery phase. I’m optimistic we’ll see gains for the year,” said Kevin Lilley, head of European equities at Old Mutual Global Investors U.K. Ltd., which manages $17 billion.
National benchmark indexes rose in 14 of the 18 western European markets today. France’s CAC 40 added less than 0.1 percent. The U.K.’s FTSE 100 climbed 0.1 percent. Germany’s DAX slid 0.1 percent.
The service industry in the U.S. grew at a faster pace last month, after expanding in December at the slowest rate since July 2012, the Institute for Supply Management said today. The group’s non-manufacturing index increased to 54 in January from 53 in December. The median forecast in a Bloomberg survey called for a reading of 53.7.
Companies in the U.S. increased payrolls by 175,000 in January, figures from the ADP Research Institute in Roseland, New Jersey, showed. That missed the median projection of 40 economists surveyed by Bloomberg that called for an advance of 185,000. Estimates ranged from gains of 125,000 to 241,000.
The private report precedes the Labor Department’s payrolls data on Feb. 7. Official figures showed jobs rose 74,000 in December, missing the projection for an increase of 197,000.
GlaxoSmithKline added 1.6 percent to 1,579.5 pence after saying revenue will rise 2 percent and earnings per share excluding currency swings and some items will increase by 4 percent to 8 percent in 2014.
Swatch increased 3.9 percent to 553.50 Swiss francs after saying 2013 operating income rose 17 percent to 2.31 billion francs ($2.55 billion). That exceeded the 2.07 billion-franc average estimate of analysts in a Bloomberg survey. The biggest maker of Swiss watches said it got more than 400 million francs in compensation from Tiffany & Co. over a failed alliance.
Handelsbanken advanced 3 percent to 318.40 kronor, its biggest increase since Oct. 22. The Swedish lender proposed a total dividend of 16.50 kronor per share, comprising a special dividend of 5 kronor and a regular dividend of 11.50 kronor. That compares with a payout of 10.75 kronor per share a year earlier and a Bloomberg dividend projection of 11.50 kronor.
Gauges of banks and health-care companies were among the best performers among 19 industry groups in the Stoxx 600.
ING Groep NV added 2.3 percent to 9.95 euros. Credit Suisse Group AG added the Dutch lender to its European focus list, citing the stock’s recent decline. The Dutch bank slumped 11 percent from a Jan. 15 high through yesterday. Credit Suisse also said ING may announce new targets and a dividend policy at its investor meeting March 31.
Novo Nordisk climbed 3.3 percent to 225.20 kroner. Nordea Bank AB said a recent study showed Sanofi’s Lantus insulin drug isn’t superior to Novo Nordisk’s Victoza treatment.
Alfa Laval AB gained 4.6 percent to 162.80 kronor, its biggest advance in one year. The largest maker of heat exchangers posted fourth-quarter order intake of 8.17 billion kronor ($1.25 billion), compared with 7.45 billion kronor in the third quarter. Commerzbank AG said in a note the order intake beat analysts’ estimates for the first time since the second quarter of 2012.
Hargreaves Lansdown tumbled 10 percent to 1,345 pence. Operating-profit margin in the six months ended Dec. 31 fell 49 basis points to 65.15 percent, according to a statement. The brokerage announced a payout of 7 pence per share, trailing the Bloomberg dividend estimate of 7.3 pence.
Syngenta AG lost 3.4 percent to 306.20 francs after the biggest maker of crop chemicals reported full-year net income of $1.64 billion and sales of $14.7 billion. That missed estimates for profit of $1.7 billion and revenue of $14.9 billion.
Konecranes Oyj slid 4.4 percent to 24.50 euros as the size of its order book shrank 5.2 percent at the end of December to 893.5 million euros ($1.2 billion), the lowest in three years.