On Monday, European stock indices are showing gains after they were falling during Friday's session. Market participants continue to digest quarterly and semi-annual reports of major European companies. In addition, investors are assessing economic data on the US, speculating about the prospects of a recession in the global economy.
At the time of writing, the composite index of the leading companies in Europe STOXX Europe 600 increased by 0.51% to 437.93 points.
Shares of British oil and gas exploration and production company Orron Energy AB added 9.8% and showed the highest results among the STOXX Europe 600 components.
The French CAC 40 gained 0.59%, the German DAX added 0.40%, and the British FTSE 100 rose by 0.26%.
Top gainers and losers
The value of securities of British financial services provider Hargreaves Lansdown soared by 8.7%. The day before, economists from Deutsche Bank significantly increased the value benchmark for the shares of the financial company.
The market capitalization of French utility services operator Veolia Environnement SA increased by 2.0%. Earlier, the company confirmed the information about the sale of the British unit of Suez Recycling and Recovery UK Group, engaged in waste recycling, to the Australian investment bank Macquarie Asset Management for $2.4 billion.
Siemens Energy AG stock, a German supplier of equipment for the energy industry, plummeted by 3.9%. On Monday, the company's management reported an increased net loss in the third quarter of fiscal 2022 and $204 million in expenses related to the restructuring of its business in Russia.
The value of the securities of British clothing retailer Joules Group PLC increased by 33%. Yesterday, the company announced that it was in talks with its competitor Next to buy a strategic share of the clothing chain.
On Monday, Next's share price jumped by 0.4%.
Market sentiment
Today market participants in Europe are expecting the key rate hike by the US Fed on the back of American labor market data. On Monday, market experts also say that strong data may force the regulator to increase the rate more aggressively.
In July, the unemployment rate in the US fell to 3.5% from June's 3.6%. At the same time, the number of Americans employed in non-farm industries grew twice as much as the preliminary market forecasts by 528,000.
This week, investors will analyze data on inflation in the United States. The publication is scheduled for Wednesday.
According to economists' preliminary scenarios, the annual inflation rate in the country fell to 8.7% in July from June's 9.1%, the highest rate since 1981.
At the end of the week, the UK GDP for June and the second quarter of 2022 will also be released.
Last Thursday, representatives of the Bank of England warned of the prospects of the UK economy entering into a prolonged period of recession in the fourth quarter of 2022.
In addition, the Central Bank of England increased its key interest rate by 50 basis points to 1.75% from 1.25% as part of the fight against record inflation yesterday. The regulator's August rate hike was the sixth in a row, and the rate of increase was the fastest since 1995.
Friday's trading results
On Friday, European stock exchange indicators fell, following the key indicators of the US stock market. At the same time, the decline in US stock exchanges was the result of the publication of strong data on the country's labor market for July. Investors began to fear deterioration in the global economy due to a tightening of monetary policy by global central banks.
Traditionally, when determining the further course of monetary policy, the Fed relies on unemployment statistics in the country. Thus, strong values for July can strengthen the regulator's hawkish sentiment.
On Friday, the composite indicator of the leading companies in Europe STOXX Europe 600 declined by 0.76% to 435.72 points.
The British FTSE 100 dropped by 0.11%, the French CAC 40 lost 0.63%, and the German DAX shrank by 0.65%.
At the same time, the FTSE 100 rose by 0.22%, the CAC 40 added 0.37%, and the DAX soared by 0.67%.
The stocks of the German insurance company Allianz fell by 1.6%. In the second quarter of fiscal 2022, the net profit of one of Europe's largest insurers fell by 23% amid market volatility. Despite this, the company reported an increase in operating profit.
The share price of the British advertising holding WPP collapsed by 8.8%. At the same time, in January-June, one of the key players in the global advertising market has increased its operating profit by 11% and revenues by 10%. In addition, the company's management improved its forecast until the end of 2022.
The market capitalization of German postal and logistics company Deutsche Post DHL Group soared by 4.6% on revenue growth of 23% year-over-year in the second quarter. The company's final results significantly exceeded analysts' preliminary forecasts.
The securities of a French company specializing in the development and publication of computer games Ubisoft Entertainment SA, declined by 0.5%. Recently, the Chinese IT-holding company Tencent Holdings said it was considering increasing its stake in the French developer of computer games.
Shares of the stock exchange and financial information company London Stock Exchange Group PLC jumped by 1.7%. In the first half of the year, LSE significantly increased pre-tax profits and reported the launch of a securities buyback program worth up to $911.9 million.
The market value of the Italian tire manufacturer Pirelli & C SpA increased by 4.3%. The company increased its net profit 1.8 times from January to June.
