European Stocks Advance as Investors Weigh Ukraine, ECBNamitha Jagadeesh
European stocks advanced in the final minutes of trading, after remaining little changed for much of the day, as European Union governments weighed further sanctions on Russia and as investors awaited this week’s European Central Bank meeting.
Novartis AG climbed the most in almost three years after saying its experimental heart drug showed better results than standard therapy. Iliad SA tumbled 8.8 percent after people familiar with the matter said it is talking to private-equity firms to make an improved offer for T-Mobile US Inc.
The Stoxx Europe 600 Index added 0.3 percent to 342.86 at the close after trading about half of a point above yesterday’s close of 342 since late morning. The gauge rose 1.8 percent in August as ECB President Mario Draghi signaled policy makers are considering bond purchases to combat persistent low inflation.
“Markets are choosing to wait and see what happens at this week’s ECB meeting,” Jacques Porta, who helps oversee $780 million at Ofi Gestion Privee in Paris, said. “Investors are expecting a strong move from the ECB because Draghi said he will do something to help growth. The continued conflict in Ukraine, with the EU considering more sanctions, does not help markets.”
The volume of shares changing hands in Stoxx 600-listed companies was 36 percent lower than the 30-day average for this time of the day, according to data compiled by Bloomberg. U.S. markets are closed today for Labor Day holiday.
National benchmark indexes rose in 10 of the 18 western European markets. The U.K.’s FTSE 100 and Germany’s DAX gained less than 0.1 percent, while France’s CAC 40 slipped less than 0.1 percent.
French Prime Minister Manuel Valls yesterday urged the ECB to take more action to weaken the euro. Banks including Nomura International Plc and UniCredit SpA say the odds of the central bank introducing bond-buying have increased since Draghi’s Aug. 22 speech. The ECB will keep its interest rates unchanged at the next meeting on Sept. 4, according to the median of economist estimates in a Bloomberg News survey.
EU leaders gave the European Commission a week to deliver proposals for sanctions that may target Russia’s energy and finance industries. Pro-Russian separatists attacked two Ukrainian coast-guard vessels for the first time, Ukraine’s military said. The U.S. and EU have already imposed measures to curb Russia’s access to bank financing and advanced technology.
In China, the government’s purchasing managers’ index for manufacturing fell to 51.1 in August, missing the median economist estimate. Readings above 50 indicate expansion. Separately, Markit Economics said its U.K. factory gauge fell to a 14-month low and a similar measure for the euro area came in lower than initially estimated.
Novartis advanced 4.3 percent to 85.90 Swiss francs, its biggest increase since Sept. 6, 2011. In a trial involving 8,442 patients, the drugmaker’s LCZ696 treatment reduced the risk of death and hospitalization caused by heart failure by 20 percent, compared with enalapril, the standard therapy, research published in the New England Journal of Medicine showed.
ITV Plc gained 3.6 percent to 218.7 pence after the Sunday Telegraph reported that Liberty Global Plc is preparing a takeover offer. The newspaper said Liberty Global, which owns a stake in ITV, is seeking the backing of other shareholders of the British broadcaster. It did not say where it got the information. Liberty Global holds 6.5 percent of ITV, according to data compiled by Bloomberg.
Havas SA gained 1.2 percent to 6.30 euros after posting first-half revenue of 867 million euros, exceeding analysts’ projection of 849 million euros. The French advertising company said all economic zones showed a moderate recovery in the first six months of the year, a trend it expects will continue in the second half.
Iliad fell 8.8 percent to 152.45 euros, its lowest price and the biggest drop this year. People familiar with the matter said the French mobile carrier has been talking to U.S. buyout firms as well as companies and sovereign-wealth funds to improve its bid for T-Mobile. Deutsche Telekom AG is said to be willing to negotiate a sale of its T-Mobile unit if the offer values the latter at $35 a share or more.
Iliad on Aug. 29 reported first-half net income of 139.9 million euros ($184 million), missing the average analyst estimate of 155 million euros.
Tesco Plc dropped 1.9 percent to 225.55 pence. Sunday Telegraph reported that Harris Associates cut its stake in the British grocer to 1 percent from 3 percent. Separately, Stoxx Ltd. said it will remove the British retailer from its Stoxx Europe 50 Index.