(Reuters) - European shares crept up to a record high on Tuesday as a strong outlook from hearing aid maker Demant supported healthcare stocks, although broader gains were stifled by losses in miners and the prospect of major central bank meetings.
The pan-European STOXX 600 index closed 0.1% higher at 479.71 points, with healthcare stocks leading gains with a 1.3% rise. Denmark’s Demant was among the best performers in the sector after it unexpectedly hiked its annual profit outlook.
Mining stocks led losses, down 2.9% on a slump in iron ore and copper prices, as loose supply conditions and a poor demand outlook for China rattled metal markets. [IRONORE/]
Antofagasta and ArcelorMittal SA were among the worst performers in the sector.
The STOXX 600 had closed at a record high on Monday, carrying over strong gains from October on the back of positive earnings and a jump in bank stocks fuelled by expectations of a rate hike by the European Central Bank next year.
“The environment of higher inflation and higher yields favours certain corporates, but it’s uncertain for others, which leaves you in a very volatile market,” said Bert Colijn, senior economist at ING.
“But the underlying moves are positive, with better-than-expected GDP figures and a quicker-than-expected recovery.”
About 166 companies of the STOXX 600 have reported quarterly earnings so far and 65.7% have topped profit estimates, according to Refinitiv IBES data. In a typical quarter, 52% beat estimates.
Focus now turns to a decision by the Fed on when it plans to begin tapering its massive stimulus measures, as well as a decision from the Bank of England later in the week. Both banks are expected to outline measures to contain a recent spike in inflation.
A survey showed euro zone manufacturing activity remained strong in October, but supply chain bottlenecks and logistical problems sent input costs soaring and curtailed growth.
Among individual stocks, meal-kit delivery firm HelloFresh surged 17.3% after raising its sales forecast for 2021.
Weighing on UK’s blue-chip FTSE 100, the world’s largest online betting group Flutter Entertainment dropped 7.7% after trimming its full-year forecast due to unfavourable sports results and a temporary closure of its Dutch operations.
London-based Standard Chartered slumped 7.8% despite reporting a doubling in profit for the third quarter. The bank said it had $4.2 billion in exposure to China’s real estate sector, where China Evergrande Group has been grappling with an enormous debt pile.
Reporting by Anisha Sircar in Bengaluru; Editing by Shounak Dasgupta, William Maclean
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