March 1, 2019 / 9:47 AM / 8 months ago

UPDATE 1-European shares start March on a high as Moncler, WPP shine

* STOXX 600 rises 0.7 pct

* European stocks at 5-month highs

* Belgium’s Proximus weighs on telecoms (Adds quotes, stocks)

By Julien Ponthus and Helen Reid

LONDON, March 1 (Reuters) - European shares rose to five-month highs in the morning of the first trading day of March as a fresh batch of corporate updates helped drive a risk-on mood after U.S. President Donald Trump earlier fueled some concerns over trade talks with China.

The pan-regional STOXX 600 index was up 0.7 percent by 0926 GMT to above 375 points, a level not see since Oct.8.

“Momentum has flagged slightly in recent sessions and concrete news of an agreement between the U.S. and China is now needed to prolong the rally in risk assets,” wrote Peel Hunt analyst Ian Williams, noting that in the meantime it was up to corporate earnings to maintain morale.

Gains spread across all regional bourses with Germany’s exporter-heavy DAX leading the charge thanks notably to rising car makers stocks.

“If corporate profits do grow, which I think they will, equities look reasonably good value,” said Edward Rumble, European equity portfolio manager at RWC Partners.

The optimism on markets came despite mixed news from economic indicators.

Data showed euro-zone manufacturing activity went into reverse for the first time in over five years, but German retail sales jumped and the bloc’s powerhouse unemployment remained at record lows.

All sectors were on the rise but telecoms were flat. The sector, a traditional defensive play, has suffered from the 5-percent fall experienced by Belgium’s Proximus after it published disappointing results.

Italian luxury group Moncler stole the spotlight with its 2018 results, which broker Jefferies called “remarkable”, and rose 8.7 percent.

Moncler peer benefited from the rally with Gucci owner Kering up 3 percent, LVMH up 2.1 percent and Burberry rose 1.8 percent.

In the less fashionable food industry, Spanish sausage casing producer Viscofan was up 7.6 percent after it struck an upbeat note on 2019 guidance and Kepler Cheuvreux upgraded it to “hold” from “reduce”.

Britain’s WPP, the world’s biggest advertising company, rose 6.6 percent after its full-year results came as a relief amid fears the industry is facing structural headwinds.

Investors have been cautious about the company since French rival Publicis earlier this month results alarmed the market.

Among financials, Jupiter Fund Management was another big gainer, up 8.5 percent after its dividend beat estimates.

“The company paid out 90 percent of underlying earnings, driving the beat,” write KBW analysts.

It was a different story for hedge fund manager Man Group which lost 3.6 percent after reporting funds under management fell last year.

Another disappointment came in from and Rightmove which fell 5 percent.

The property website reported its slowest full-year underlying operating profit growth in nine years, sending its shares down nearly 7 percent at the bottom of London’s blue-chip index. (Reporting by Julien Ponthus, additional reporting by Helen Reid; Editing by Helen Reid and Josephine Mason)

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