European Stocks Accelerate Gains as Draghi Rides to the RescueBy and
Miners lead advance as all Stoxx 600 industry groups rise
EasyJet rallies after raising annual profit forecast
For European stock investors seeking assurances of central-bank support after China-fueled volatility rocked global markets, Mario Draghi didn’t disappoint.
Stocks that were already up before the ECB president’s press conference in Frankfurt rose higher after he unveiled a revamp of his quantitative-easing program that allows officials to buy higher proportions of each euro-area member’s debt. Officials cut forecasts for economic growth and inflation, citing the emerging-market rout as a threat.
“Draghi is really trying to assure the market that the ECB is ready to act and we’ll have QE for the next years,” said Benno Galliker, a trader at Luzerner Kantonalbank AG in Lucerne, Switzerland. “He is doing everything is needed to stabilize the market. QE is here to stay for quite a while.”
The Stoxx Europe 600 Index climbed as much as 2.9 percent, before closing 2.4 percent higher. The gauge halted a rout yesterday, after posting the worst monthly performance in four years and tumbling further earlier this week amid concern over a slowdown in China.
A gauge of services and manufacturing in the euro area climbed to a four-year high in August, a Markit report showed. With Chinese exchanges closed for a holiday, investors also got a respite from market moves there.
All 19 Stoxx 600 groups climbed, with miners rallying the most. Glencore Plc and Anglo American Plc each gained at least 6 percent.
UniCredit SpA advanced 3.4 percent after people familiar with the matter said the bank is considering cutting at least 10,000 jobs.
EasyJet Plc and Air France-KLM Group led airline shares higher. The British discount carrier rallied 5.4 percent after raising its annual profit forecast, while the French company jumped 7.2 percent. A report said Air France is considering creating a low-cost, long-haul unit.
Syngenta AG advanced 3.5 percent after saying it plans to buy back $2 billion of shares and sell a business. Polyus Gold International Ltd. climbed 3 percent. Russia’s largest gold producer may become the target of a buyout offer from its largest shareholder.
Abengoa SA’s Class B shares slid 6.8 percent. Bonds of the Spanish renewable energy company fell after reports that some banks won’t underwrite its planned capital increase.
— With assistance by Inyoung Hwang
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.