European Stocks Advance With DAX as German Economy AcceleratesNamitha Jagadeesh and Sofia Horta e Costa
European stocks climbed with Germany’s DAX Index after a report showed the nation’s economy accelerated.
The Stoxx Europe 600 Index added 0.6 percent to 377.07 at the close of trading, paring gains of as much as 0.8 percent. It extended a seven-year high as Greek and European Union leaders signaled willingness to compromise on bailout terms. The measure has gained 1.1 percent this week for a second straight advance.
The DAX climbed as much as 0.9 percent to 11,013.85 in intraday trading, rising above 11,000 for the first time, before closing 0.4 percent up. The benchmark gauge is up 12 percent this year, making Germany among the best performers in 24 developed markets tracked by Bloomberg. German gross domestic product surged 0.7 percent in the fourth quarter, a faster pace than the previous three months, data showed. The euro region’s economy also gathered momentum.
“Markets are being driven by evidence that the European economy is recovering,” said Dirk Thiels, head of investment management at KBC Asset Management NV in Brussels. “Today’s German GDP figures were quite encouraging. The hard data is finally giving us some relief and investors will be pretty happy that the core of Europe is holding up. The market is back to an optimistic view on Greece.”
The Stoxx 600 rose yesterday as optimism grew that a cease-fire agreement will help stem conflict in Ukraine, and that Greece will reach a deal. The benchmark gauge has jumped 10 percent this year as the European Central Bank unveiled a 1.1 trillion euro ($1.2 trillion) asset-purchase plan. Stocks have widened a gap with the euro on speculation the ECB’s policies will help boost economic growth and corporate profits.
Greece’s ASE Index rallied 5.6 percent for the best performance among 18 western European markets. National Bank of Greece SA and Eurobank Ergasias SA jumped, pushing their weekly gains up at least 35 percent. Benchmark measures in Spain and Portugal advanced more than 1.6 percent.
Prime Minister Alexis Tsipras said yesterday that political will exists in the euro region for a deal. His government is seeking a six-month bridge agreement with creditors after its current aid program expires this month. German Chancellor Angela Merkel said her first meeting with Tsipras was friendly. Greece’s finance minister met experts from the country’s international creditors in Brussels today.
Among stocks that moved on corporate news, Anglo American Plc gained 3.4 percent after posting full-year earnings that beat analysts’ projections and writing down assets. GlaxoSmithKline Plc rose 4.5 percent as UBS Group AG raised its recommendation on the drugmaker to buy from sell.
ThyssenKrupp AG lost 2.6 percent as Germany’s largest steelmaker reported quarterly earnings that missed analysts’ estimates. Seadrill Ltd. slumped 9.6 percent after the rig operator said it’s removing $1.1 billion worth of contracts with Petroleo Brasileiro SA from its order book.
Mediaset SpA declined 6.5 percent after Silvio Berlusconi’s Fininvest SpA sold a 7.8 percent stake in the broadcaster.