European equities were higher heading into Tuesday afternoon, boosted by hope that China’s top leaders will meet to set out lofty economic aims and discuss stimulus measures for next year.
The FTSE 100 index rose 58.76 points, 0.7%, at 8,371.65. The FTSE 250 added 125.89 points, 0.6%, at 20,894.94, and the AIM All-Share rose 2.10 points, 0.3%, at 735.14.
The Cboe UK 100 added 0.8% at 840.75, the Cboe UK 250 was also up 0.8% at 18,396.44, and the Cboe Small Companies gained 0.1% to 15,899.37.
The DAX 40 in Frankfurt added 0.1%, slipping back after topping 20,000 points for the first time. The CAC 40 in Paris was up 0.2%. The CAC had ended flat on Monday, while the DAX jumped 1.6%.
‘December is Santa rally territory and so far, it’s got off to a good start. European equity markets are a sea of green on Tuesday, and French markets are bouncing back,’ XTB analyst Kathleen Brooks commented.
French legislators are expected to hold a vote of no confidence against the government of French Prime Minister Michel Barnier on Wednesday afternoon, parliamentary sources said on Tuesday.
A no-confidence motion tabled by the left-wing alliance is likely to be adopted after the far-right National Rally said it would back it. The debate is set to begin on Wednesday.
Helping to lift the mood on Tuesday, China’s top leaders are preparing a closed-doors meeting next week to talk economic targets and stimulus plans for next year, Bloomberg reported.
Among those in European markets to rise on Tuesday were a who’s who of China-exposed stocks. Miner Antofagasta added 1.9% and lender HSBC rose 1.4% in London, while LVMH Moet Hennessy Louis Vuitton climbed 0.9% in Paris.
XTB analyst Brooks continued: ‘For now, the markets are ignoring the geopolitical risks bubbling around the world. The French government is poised to collapse at some point this week, and China has decided to ban the export to the US of some items that can be used for military purposes, including gallium, geranium and other superhard materials. It will also use implement a stricter screening process for graphite exports to the US, which is a crucial input to produce lithium batteries. It will be interesting to see how Elon Musk reacts to this, and it suggests that the rest of the world will meet President Trump’s war on global trade blow for blow.’
The pound was quoted at $1.2667, moving higher from $1.2643 at the time of the London equities close on Monday, but off an earlier high of $1.2696. The euro stood at $1.0524, climbing from $1.0486. Against the yen, the dollar was trading at JP¥149.73, a rise from JP¥149.24.
Equities in New York are called to open largely lower, with the Dow Jones Industrial Average down 0.1%. The S&P 500 is called to open marginally in the red, and the Nasdaq Composite down 0.1%.
Tuesday’s global economic diary sees the US job openings survey and labour turnover survey at 1500 GMT.
Scope Markets analyst Joshua Mahony commented: ‘Today marks the beginning of a four-day period where US jobs move front and centre for traders, with the JOLTS job openings expected to improve after last month saw the worst reading in over three years. However, the big focus will be on the resolution of last months curious scenario where ADP payrolls soared from 159,000 to 233,000, while the official NFP figure collapsed to a three-year low of 12,000. With the market reaction to that payrolls figure highlighting a confidence that it is simply a temporary reaction to non-economic factors such as hurricanes and strikes, the ability to bounce back will be key this week.’
The ADP jobs report is released on Wednesday, before the official nonfarm payrolls on Friday.
Brent oil was quoted at $72.57 a barrel early Tuesday afternoon, up from $71.85 at the time of the European equities close on Monday. Gold traded at $2,644.74 an ounce, up from $2,642.00 on Monday.
Back in London, Victrex jumped 14%. The Lancashire, England-based polymer solutions provider for automotive, aerospace, energy and industrial, electronics, and medical markets said pretax profit fell 68% to £23.4 million in the financial year that ended September 30 from £72.5 million a year ago.
Revenue contracted 5.2% to £291.0 million from £307.0 million.
Decent volume growth in the fourth-quarter was a cause for optimism, however. In the fourth quarter of financial 2024, sales volumes were up 21% on-year.
Chief Executive Jakob Sigurdsson said: ‘If current demand levels remain on track, with some seasonality in our Q1, a run-rate across the rest of the year similar to the FY 2024 exit rate - of around 1,000 tonnes per quarter - offers the potential for at least mid-single digit volume growth.’
On the decline, Currys gave back 2.4%. Deutsche Bank cut the electricals retailer to ’hold’ from ’buy’.
On the Beach jumped 17%. It declared a final dividend and launched a £25 million share buyback, as cash piled up thanks to a near doubling in annual profit.
The company declared a 2.1 pence per share final dividend for a full-year payout of 3.0p, compared to none previously. The share buyback, worth up to £25 million, was started on Tuesday and will be completed by March 31.
On the Beach said pretax profit was £26.5 million in the financial year that ended September 30, up 84% from £14.4 million in financial 2023, as revenue grew by 14% to £128.2 million from £112.1 million.
Over in New York, BlackRock fell 0.9% in pre-market dealings after announcing a bumper deal to boost its ‘private credit capabilities and scale’.
The asset manager is to acquire HPS Investment Partners for $12 billion. The deal will be funded through the issue of shares.
‘I am excited by what HPS and BlackRock can do together for our clients and look forward to welcoming Scott Kapnick, Scot French, and Michael Patterson, along with the entire HPS team, to BlackRock. We have always sought to position ourselves ahead of our clients’ needs. Together with the scale, capabilities, and expertise of the HPS team, BlackRock will deliver clients solutions that seamlessly blend public and private,’ BlackRock Chair & CEO Laurence Fink said.
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