European shares rise amid tech stock, autos boost

European shares are higher as investor sentiment is buoyed by some positive earnings reports, a record Nasdaq index close and US Fed chairman Powell's remarks.

European shares rise amid tech stock, autos boost

European shares are higher Wednesday, as investors are buoyed by a strong performance on the US Nasdaq index Tuesday. Sentiment is also upbeat following a number of positive earnings updates across European businesses.

By 1200 BST, the EUROSTOXX 600 was 0.42% higher, while the EUROSTOXX 50 had gained 0.63%. The regional bourses were also largely positive. The German DAX rose 0.69%, the French CAC was 0.46% in the green, while the Spanish IBEX edged down 0.03%.

Tech stocks boost shares

European shares are higher Wednesday as investors gain confidence following a fresh record close on the US Nasdaq index Tuesday. Earnings updates have also worked to lift European indices.

Ericsson shares are 7.35% higher at SEK74.85 after the Swedish telecoms equipment maker reported a surprising, albeit small profit, in the second quarter. A combination of cost-cutting and growing sales in north America were behind the better-than-expected report.

Tele2 shares are also higher, rising 13.43% to hit SEK114.05. The Swedish telecoms operator also reported better-than-expected Q2 earnings, while raising its forward earnings guidance for the whole of 2018.

US Fed Powell’s remarks support autos

US Federal Reserve Chairman Jerome Powell testified before congress Tuesday and made positive comments on the outlook for the US economy.

“Overall, we see the risk of the economy unexpectedly weakening as roughly balanced with the possibility of the economy growing faster than we currently anticipate,” Powell told US lawmakers on Capitol Hill.

“The unemployment rate is low and expected to fall further. Americans who want jobs have a good chance of finding them,” he added.

That first part of his hearing – which will continue Wednesday – helped buoy the dollar, which in turn lead to weaker European currencies.

That currency effect has helped support auto stocks, due to the importance of exports to the industry.

  • Daimler shares are1.29% higher at €58.22.
  • Fiat Chrysler shares rose 1.12% to €16.82.
  • BMW shares gained 0.92% to hit €80.76.

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