European Stocks Advance as ECB Leaves Rate UnchangedSofia Horta e Costa
European stocks posted their biggest three-day rally in 10 weeks as the European Central Bank left its benchmark interest rate at a record low.
Ingenico Group jumped the most in almost two years after the French maker of payment terminals said it’s in talks to acquire online payment-service provider GlobalCollect. K+S AG gained 2.6 percent after saying it will expand its specialty-fertilizer and salt businesses, and that potash prices are recovering. Balfour Beatty Plc dropped 4.5 percent after saying profit at its engineering services unit will be lower than it had forecast.
The Stoxx Europe 600 Index added 0.9 percent to 348.91 at the close in London, bringing its three-day gain to 2.1 percent. The European equity benchmark gauge climbed 2.3 percent in the second quarter, capping the longest stretch of quarterly advances since 2010 and reaching a six-year high last month.
“Draghi can keep the markets happy with words and promises that he will act if needed, but in the end he hasn’t really been forced to do so,” said Tobias Britsch, who helps oversee about $33 billion at Meriten Investment Management GmbH, in Dusseldorf, Germany. “He has convinced the market so far.”
The ECB kept its benchmark interest rate at 0.15 percent, and President Mario Draghi reiterated that he’ll keep rates low. Stocks rallied on June 5 after the central bank announced new measures to stimulate lending and said it would begin preparations for an asset-purchase plan.
In the U.S., Labor Department data showed employers added 288,000 workers in June, more than forecast, and the jobless rate fell to an almost six-year low of 6.1 percent. Another report from the Institute for Supply Management showed services industries, which make up almost 90 percent of the world’s largest economy, expanded last month.
National benchmark indexes rose in every 18 western-European markets today except Portugal. France’s CAC 40 added 1 percent, while the U.K.’s FTSE 100 gained 0.7 percent, and Germany’s DAX advanced 1.2 percent.
Ingenico jumped 9.7 percent to 71.59 euros. The payment-terminals maker would fund the 820-million euros ($1.12 billion) purchase of Amsterdam-based GlobalCollect with cash and debt, according to a statement late yesterday. The company expects to complete the deal in the fourth quarter.
K+S climbed 2.6 percent to 24.71 euros. The maker of ingredients used in crop fertilizers is looking to boost the proportion of sales from higher-margin fertilizers that have magnesium and sulfur content, Chief Executive Officer Norbert Steiner said. Andreas Radmacher, the head of the potash division, said K+S has seen the first signs of a price recovery in the product.
Man Group Plc jumped 6.1 percent to 113.8 pence, the highest price in 13 months. The biggest fund at the world’s largest publicly traded hedge-fund manager posted its best start to a year since 2008, data compiled by Bloomberg show.
Sweden’s OMX Stockholm 30 Index advanced 1.5 percent, its biggest jump since April 22, as the country’s central bank lowered its main interest rate more than projected, sending the krona down by the most in almost three years against the euro.
Exporters led gains. Atlas Copco AB, a maker of air compressors, advanced 2.9 percent to 197.70 kronor. Packaging company BillerudKorsnas AB climbed 4.3 percent to 103.40 kronor, its highest price on record. Copper and zinc producer Boliden AB rose 6.3 percent to 106.40 kronor, with its CEO saying the rate reduction is “great for us.”
That helped send a gauge of mining stocks for the biggest increase among 19 industry groups on the Stoxx 600. Antofagasta Plc added 4.9 percent to 820 pence, and Fresnillo Plc gained 3.2 percent to 933.5 pence.
Mediaset SpA climbed 3.9 percent to 3.75 euros for a second day of gains. Mediobanca SpA upgraded the Italian broadcaster to neutral from a rating similar to sell. People familiar with the matter said yesterday that Mediaset is close to an agreement to sell its 22 percent stake in Distribuidora de Television Digital to Telefonica SA.
Balfour Beatty lost 4.5 percent to 222.5 pence. The British construction company said profit at the mechanical and electrical engineering unit was 35 million pounds ($60 million) lower in the first half than it had predicted. Balfour Beatty will report financial results for the six-month period ending June 27 on Aug. 13.