European shares broadly higher; Banks buck trend

European shares are broadly higher amid a raft of upbeat earnings reports and a hopeful outlook for US-China trade talks.

European shares broadly higher; Banks buck trend

European shares are mainly in the green in early Friday afternoon trading. However, banks are lagging that positivity. A wide range of upbeat earnings reports is helping to buoy indices, meanwhile, investors are also gaining a boost to sentiment from US-China trade talks.

By 1230 BST, the EUROSTOXX 600 was 0.29% higher and the EUROSTOXX 50 was up 0.17%. Regional bourses, meanwhile, were a little mixed. The German Dax was 0.47% in positive territory and the Spanish IBEX gained 0.40%. However, the French CAC lost 0.04%.

Bank earnings disappoint

Amid another busy morning for earnings releases, banks disappointed investors.

HSBC shares slipped 2.68% to £702.00 amid a decline in its quarterly profits and the announcement of a $2 billion share buyback.

BNP Paribas shares, meanwhile, were also around 2% lower at €62.10 after the French bank reported a 17% drop in Q1 income thanks to weaker revenues in the period.

And, Societe Generale shares were also in the red, falling 6.11% to €42.16. That drop came despite reporting a 14% profit increase, as its Q1 revenues missed expectations.

And, adding to the gloom in French stocks, Air France KLM shares slid 5.47% to €7.88 after it reduced its full-year guidance in the wake of staff strikes since February.

Upbeat tone elsewhere

While banks and some French stocks were lower, positivity elsewhere helped to lift other European indices Friday.

Ferrari shares gained 4.12% to €130.99 after a better-than-expected quarterly report. And, German chemicals specialist Lanxess shares surged 8.46% to €66.70. The company reported a rise in Q1 net income and also increased its full-year guidance which encouraged investors to buy the stock.

There’s also an air of mild positivity with regards to the US-China trade talks taking place in Beijing. However, that’s balanced by a little uncertainty ahead of the US jobs report due soon.

Investors will watch the release closely for clues on the health of the US economy and also any signs of inflationary pressures from the earnings data contained in the report.

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