EUROPE MARKETS: European Stocks Leap To 2-year High As Commodity Shares March Up

By Carla Mozee, MarketWatch Features Dow Jones Newswires

European stocks jumped to their highest in more than two years Wednesday, with German shares on course for a new record. Commodity shares were among the strongest performers as November trading started.

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What stock indexes are doing:

The Stoxx Europe 600 index climbed 0.6% to 397.56, in line for its best close since August 2015, according to Factset data. All sectors except for the consumer services group rose, and advancers were led by basic materials and tech shares. On Tuesday, the index rose 0.3% (http://www.marketwatch.com/story/european-stocks-stick-around-5-month-highs-cruise-toward-october-gain-2017-10-31) and finished October trade up by 1.8%.

Germany's DAX 30 index on Wednesday rallied 1.4% to 13,410.07, on course for another all-time closing high. Trading in Germany was closed Tuesday for the Reformation Day holiday.

France's CAC 40 rose 0.5% to 5,531.62, and the U.K.'s FTSE 100 advanced 0.1% to 7,502.30. Spain's IBEX 35 climbed 0.4% to 10,564.80.

What's moving markets:

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Mining stocks popped higher on the back of data from Caixin showing Chinese factory activity held steady in October, indicating a stable pace of expansion (http://www.marketwatch.com/story/china-caixin-manufacturing-pmi-holds-steady-2017-10-31). Shares of mining companies can be sensitive to economic data from China, as the country is a major buyer of industrial and precious metals. The Stoxx Europe 600 Basic Resources Index surged 2.3% on Wednesday.

Metals prices were also rising, with copper futures up more than 2%.

Oil futures , meanwhile, climbed more than 1%, trading around two-year highs. That move has been supported by talk that the Organization of the Petroleum Exporting Countries and other producers will extend production cuts when they meet next week. The Stoxx Europe 600 Oil and Gas Index rose 1.1%.

After trading closes Wednesday, investors will watch for what the U.S. Federal Reserve is signaling about the path of interest rates when it releases its policy decision.

Earnings season continues to roll on. According to Thomson Reuters data released Wednesday, 47.5% of results released so far by companies on the Stoxx Europe 600 have exceeded analyst estimates. In a typical quarter, 50% of results surpass analyst per-share estimates, it said.

What strategists are saying:

"European markets took over a bullish market from Asian traders," said LCG senior market analyst Ipek Ozkardeskaya.

But the "euro is under the pressure of lower eurozone yields and there is not much reason to encourage capital outflows from the eurozone's sovereign market after the European Central Bank committed to continue buying 30 billion euros worth of bonds every month until September 2018 and longer if needed," she said. She noted that the 10-year German bund yield has slipped below its 200-day moving average.

The euro bought $1.1635, down from $1.1648 late Tuesday in New York. The yield on Germany's 10-year bund was up less than 1 basis point at 0.367%.

Stock movers: Standard Chartered PLC (STAN.LN) dropped 6.4% as the Asian-focused lender in its third-quarter results said asset margins are "remaining under pressure." The bank's pretax profit more than doubled to $774 million (http://www.marketwatch.com/story/standard-chartered-pretax-profit-doubles-2017-11-01).

Novo Nordisk A/S shares fell 3.2% as the Danish drug maker said it expects low to mid single-digit growth in both sales and operating profit in local currency terms in 2018.

Shares of Next PLC (NXT.LN) dropped 4.9%, but pared deeper losses. The slide was set off after the clothing and homeware retailer narrowed its pretax profit and sales guidance (http://www.marketwatch.com/story/next-sales-rise-narrows-guidance-on-profit-2017-11-01) for the year. Third-quarter sales were up 1.3% on the year, buoyed by rising directory sales as retail sales fell 7.7%.

Paddy Power Betfair PLC reported underlying earnings grew 7.1% (http://www.marketwatch.com/story/paddy-power-betfair-earnings-rise-lifts-guidance-2017-11-01) in the quarter ended Sept. 30, as it slightly raised its full-year guidance. Shares rose 3.4%.

Indivior PLC (INDV.LN) shares rallied 10%. The pharmaceutical company said Wednesday a U.S. Food and Drug Administration committee has voted to recommend approval of its drug RBP-6000 (http://www.marketwatch.com/story/indivior-opioid-addiction-drug-gets-fda-nod-2017-11-01) for the treatment of opioid use disorder.

(END) Dow Jones Newswires

November 01, 2017 06:39 ET (10:39 GMT)