European Markets Report

By Shashwat Chauhan and Pranav Kashyap

(Reuters) – Europe's STOXX 600 bounced back with a 1% gain, driven by strong performances in the energy and technology sectors, while positive earnings reports added to the upbeat mood.

The pan-European STOXX 600 index gained 1.1% to 507.02 points. However, it remained near a three-month low, having fallen in the previous two sessions. All regional bourses also advanced between 0.5% and 1.4%.

Key Performers

• ASML (AS:ASML) gained 6.9% after it projected sales growth of 8%-14% over the next five years, boosting the tech sub-sector by 3.1%.
• Telecoms were among the top five major gainers, adding 1.8%, while heavyweight energy stocks advanced 1.7%.
• Deutsche Telekom (OTC:DTEGY) rose 3.3% after raising its full-year core profit forecast and marginally beating third-quarter core profit expectations.

Macro Overview

On the macro front, the Eurozone's GDP rose 0.4% in the third quarter, in line with a Reuters poll of estimates, while employment grew more than expected, rising 0.2%. Chris Beauchamp, chief market analyst at IG, noted that European indices finally got a break as dip buyers prompted substantial gains in these beaten-down markets. He added that broad-based buying indicated a near-term recovery.

Recent Eurozone data showed inflation is on track to reach the ECB's 2% goal, according to Vice President Luis de Guindos. Despite Thursday's gains, the STOXX 600 index had yet to rise above last week's levels, when European equities were rocked after Donald Trump's victory in the U.S. presidential election. The prospect of tariffs from the Trump administration has kept European investors on edge.

Comments from ECB President Christine Lagarde, due at 1900 GMT, will be closely monitored.

Other Notable Stocks

• Monte dei Paschi di Siena (MPS) jumped 11.6% after Italy sold a 15% stake in the bank to rival Banco BPM, which gained 4.7%.
• Siemens (ETR:SIEGn) rose 4.9% after beating fourth-quarter profit estimates.
• Burberry (LON:BRBY) soared 18.7% following a turnaround plan announcement, reversing a loss in the first half of its financial year.
• Allegro (WA:ALEP) slid 11.3% after it projected a decline in fourth-quarter earnings.