European shares gain in cautious trade
European shares were higher around midday Tuesday, after investors shrugged off weaker sentiment at the open, but remain cautious.
Investors appeared to look through German political problems for a second day and instead focusing on company fundamentals. For the time being.
By 1230 BST, the EUROSTOXX 600 was trading 0.45% higher, while the EUROSTOXX 50 was up 0.56%. The German DAX was 0.75% in the green, the French CAC was up 0.6%, while the Spanish IBEX was 0.3% higher.
Significant stock moves
Investor sentiment is marginally positive, with some strong gains.
Shares in Italian energy provider, Enel, were 2.7% higher, buoyed by news it will invest some 24.6 billion euros in capital expenditure. Volkswagen shares gained for a second consecutive day, rising 3.8% on the company’s decision to raise its mid-term outlook.
European media business ProSiebenStat was also in the green. Its shares gained 2.1% after JP Morgan raised its price target for the business. And, Easyjet shares received a strong boost on news it was able to raise air fares in the aftermath of the Ryanair debacle. EasyJet shares were up 6.9%.
Among the fallers were:
- Johnson Matthey shares fell 2.7% on a disappointing earnings update.
- Altice shares were down 5.4% on a Bank of America Merrill Lynch ratings cut.
- Shares in temporary power generator provider Aggreko slid 9.2% on the details of its earnings results.
German political developments
While the collapse of German coalition talks has yet to significantly effect investor sentiment, there’s still a chance that it could.
Acting Chancellor Angela Merkel has said she’d prefer to have a re-election than to form a minority government.
"The path to the formation of a government is proving harder than any of us had wished for," she said in a television interview with ARD. She added that "new elections would be the better path," and also stated: "I don't have a minority government in my plans."