European stocks advanced as the Swiss central bank unexpectedly reduced interest rates ahead of a Bank of England policy decision due later and as investors awaited the results of a bond auction in France.
The Stoxx 600 Index was 0.4% higher by 9:07 a.m. in London, with the technology, real estate and construction sectors leading the gains. The main equities benchmark in Zurich rose as much as 0.6% after Swiss National Bank’s second rate cut this year.
Among individual movers, Evotec SE rallied 16% following a report that the German drug developer is speaking to defense advisers after a decline in its share price prompted fears about the company’s vulnerability to a takeover. Societe BIC SA slumped as much as 19%, the most on record, after the French maker of pens and lighters downgraded its sales guidance.
Sentiment remains fragile after the calling of a snap French election on June 9 unleashed turmoil through markets. The rally in the main regional index has stalled this month and it is now about 7.6% higher since the start of the year. In the face of recent events, investors are switching exposure more toward laggard stocks and defensive plays.
The BOE will announce its decision at 12 p.m. with investors and analysts expecting the central bank to leave the benchmark rate unchanged at a 16-year high of 5.25%. Norges Bank kept Norway’s benchmark interest rate unchanged, as eonomists expected, and said a tight policy stance will be kept for somewhat longer.
In France, the Treasury aims to raise up to €10.5 billion through auctions of three- to eight-year bonds in the first sale since President Emmanuel Macron called a snap vote.
Market activity may be quieter than usual as traders ready for a quarterly event on Friday where index futures, equity index options and stocks options all expire in a process known as triple witching.
“Low volumes accompany the days before Friday’s expiry,” said Guillermo Hernandez Sampere, head of trading at asset manager MPPM. “The markets can calm down somewhat from the recent uncertainties, but global and monetary policy issues will determine the period ahead.”
SECTORS IN FOCUS:
For more on equity markets:
You want more news on this market? Click here for a curated First Word channel of actionable news from Bloomberg and select sources. It can be customized to your preferences by clicking into Actions on the toolbar or hitting the HELP key for assistance. To subscribe to a daily list of European analyst rating changes, click here.
With assistance from Michael Msika.
This article was generated from an automated news agency feed without modifications to text.
3.6 Crore Indians visited in a single day choosing us as India’s undisputed platform for General Election Results. Explore the latest updates here!
Download The Mint News App to get Daily Market Updates.
Published: 20 Jun 2024, 11:21 PM IST