Carmakers Lift Europe Stocks to 3-Month High as Volkswagen Jumps

Updated on
  • Volkswagen climbs for 10th straight day, hits September high
  • Commodity producers rebound for first time in five days

Optimism for further central-bank stimulus sent European stocks to a three-month high, fueled by gains in carmakers amid a weak euro.

The Stoxx Europe 600 Index rose 0.9 percent at the close of trading in London. The euro trading near its weakest level since April boosted exporters, sending Volkswagen AG higher for a 10th day, its longest streak in five years. The optimism was broad-based among the region’s shares, with all industry groups climbing.

Carmakers rebound with the weak euro.

“The market is in good shape, but any further upside will need some support from central banks or from a relief in commodity prices,” said Guillermo Hernandez Sampere, who helps manage about 250 million euros ($265 million) as head of trading at MPPM EK in Eppstein, Germany. “We wait for Draghi to reload the stimulus bazooka and Yellen to raise interest rates in the U.S., and then we will start to evaluate what will be the path for 2016.”

The European stock gauge has gained 2.3 percent in two days. Speculation the European Central Bank will add to stimulus measures and that the global economy is strong enough to withstand an increase in U.S. borrowing costs has helped the rebound since a September low.

With U.S. markets closed on Thursday for the Thanksgiving holiday, markets were quieter than usual. The volume of Stoxx 600 shares changing hands was about 30 percent lower than the 30-day average. Futures on the Standard & Poor’s 500 Index expiring in December rose 0.4 percent.

Europe’s stocks have regained more than half of their losses since a September low, with the Stoxx 600 closing 7.2 percent below the record reached in April. While they’re up in November for a second month, miners have declined as commodities reached their lowest prices since 1999.

Infineon Technologies AG jumped 13 percent after reporting better-than-expected operating income. That spurred gains in peers STMicroelectronics NV and Dialog Semiconductor Plc.

Bang & Olufsen A/S surged 31 percent after the Danish maker of high-end televisions and audio components said it was approached about a possible takeover. Delta Lloyd NV climbed for a third day, taking its jump to 15 percent for the period, after Rabobank pitched the idea of a purchase by NN Group NV. In turn, the Dutch insurer and asset manager spun out of ING Groep NV fell 2.6 percent.

Remy Cointreau SA dropped 3 percent as its profit declined more than analysts projected. BHP Billiton Ltd. lost 2.4 percent after a United Nations probe into a deadly mine spill said steps that the company took to prevent harm weren’t sufficient. Abengoa SA tumbled 40 percent, following a record 54 percent plunge yesterday as the Spanish renewable-energy company said it’s seeking preliminary protection from creditors.