European shares hit record highs on upbeat economic outlook

European shares moved higher Monday, hitting record highs earlier in the session as investors continue the global stocks rally, buoyed by strong European economic and business sentiment. Auto stocks led gains as investors maintained the positive tone that dominated the opening week of 2018.

European shares hit record highs on upbeat economic outlook

European shares moved higher Monday, hitting record highs earlier in the session as investors continue the global stocks rally, buoyed by strong European economic and business sentiment.

Auto stocks led gains as investors maintained the positive tone that dominated the opening week of 2018.

By 1255 BST, the EUROSTOXX 600 was 0.23% higher, while the EUROSTOXX 50 had gained 0.16%. Regional bourses were also positive, with the German DAX 0.24% higher, the French CAC up 0.28% and the Spanish IBEX 0.12% in the green.

Strong economic outlook supportive

The latest reading of euro zone economic sentiment, collated and published by the European Commission, hit 116.00 in December. That was up from November’s 114.6 and the highest level since 2000.   

The rise in sentiment was broad based with confidence in all sub-sectors – retail, industry, services, construction and consumer – improving. By region, sentiment gained notably in France and Germany, the EU Commission said.

The upbeat survey follows a strong end to 2017, as reported by the even more timely December purchasing managers index.

The euro zone composite PMI, published by data experts IHS Markit, last week, rose to a balance of 57.5 in December, the highest level since February 2011.

Together the two surveys imply the euro zone’s economic recovery gathered pace in 2017 and looks set to continue into 2018.

Stock movers

Amid that positive backdrop, there were a number of positive stock moves on the European indices Monday.

Fiat Chrysler shares began the day in positive territory, although by early afternoon they were trading 0.33% lower at €17.86. Other car makers remained in the green, however.

Volkswagen shares were 0.33% higher at €179.80 following news of another partnership with Nvidia in its autonomous car plans. Peugeot shares were up 0.28% at €18.16, while BMW shares gained 1.38% to trade at €89.72.

Elsewhere, shares in Dialog Semiconductor rose 1.45% to €26.60.

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