EUROPEAN shares ended higher on Wednesday, led by renewable-energy stocks after a revised budget bill in the United States passed a crucial vote, while focus was on any trade deals ahead of US President Donald Trump’s July 9 tariff deadline.
The pan-European Stoxx 600 index closed 0.18 per cent higher at 541.21. French equities were among the top gainers in the region with a 1 per cent jump.
Paris-listed shares of luxury giant LVMH, Italy’s Moncler and UK’s Burberry all climbed about 4 per cent each, among the top boosts on the Stoxx 600.
Swiss bank UBS lifted its rating on European luxury to “benchmark” from “underweight,” arguing the recent share underperformance has created a tactical opportunity despite ongoing risks in China.
Mining-related stocks topped the Stoxx sub-sectors, with steelmakers including ArcelorMittal and Thyssenkrupp advancing the most.
Auto stocks climbed 1.6 per cent, while euro zone banks added 1.5 per cent.
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Shares in European renewable energy companies rose after the US Senate passed a revised budget bill that was more positive for the wind industry compared to an earlier version.
“This policy shift, coupled with the resumption of construction work on Equinor’s Empire Wind project off the New York coast, suggests that the worst-case scenario for the renewables sector under the Trump administration may not materialise,” said Tancrede Fulop, senior equity analyst at Morningstar.
Vestas advanced 10.1 per cent and was the top gainer in the Stoxx 600. Orsted gained 1.8 per cent.
On the downside, a slate of UK-listed companies were at the bottom of the Stoxx 600, while the local midcap index, which is more sensitive to domestic developments, dropped 1.3 per cent.
The pound, along with British stocks and bonds dropped after a tearful appearance by Chancellor Rachel Reeves in parliament a day after the government backed down on its welfare reforms reigniting concern over Britain’s finances.
In the latest on global trade negotiations, Trump said the United States has struck a trade deal with Vietnam.
Trump on Tuesday had said he was not considering an extension of the July 9 deadline for countries to negotiate trade deals with the United States.
Meanwhile, the European Union’s trade chief is expected to hold negotiations this week in Washington to avert higher US tariffs.
Back in stocks, Greggs slid 15.2 per cent after the British baker warned its annual operating profit could dip below last year’s levels.
Spain’s Banco Sabadell gained 5.2 per cent after Santander said it had reached an agreement to buy its British unit TSB. REUTERS
