EasyJet shares jump by the most in 4 years
European stocks rose Tuesday, aided by gains for airline easyJet PLC and car maker Volkswagen AG, but the direction of trade has been choppy as investors weigh the possibility of a new election in Germany alongside a new round of corporate earnings reports.
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What markets are doing: The Stoxx Europe 600 , which has been darting between small gains and losses, was recently 0.3% higher at 387.37, with only the consumer services and telecom sectors losing ground. The regional benchmark on Monday tacked on 0.7% and logged its highest close since Nov. 10, according to FactSet data.
In Frankfurt, the DAX 30 index turned up 0.5% to 13,125.76. The index on Monday reversed losses and closed up 0.5%. France's CAC 40 reversed course and rose 0.5% to 5,366.04, and Spain's IBEX 35 gained 0.4% to 10,061.50.
The U.K.'s FTSE 100 was up 0.2% at 7,406.25.
The euro bought $1.1735, not far from $1.1733 late Monday in New York. Against the pound, the euro traded hands at GBP0.8869 versus GBP0.8866 on Monday.
What's moving markets: Prospects of a snap election were heightened after German Chancellor Angela Merkel late Monday said she would prefer voters go back to ballot boxes over running a minority government. This comes after the breakdown in negotiations to form a "Jamaica" governing coalition of parties over the weekend.
Read:Eurozone faces uncertainty after coalition talks collapse (http://www.marketwatch.com/story/euro-plummets-as-uncertainty-in-germany-rattles-markets-2017-11-19)
But broadly lower moves for the euro against its major rivals appeared to aid shares of European exporters, as a stronger value for the shared currency can make their products more expensive for overseas clients to purchase.
What strategists are saying: "Early dips have been bought in European equities, as investors take their cue from the recovery in U.S. stocks last night. Yesterday there was a brief panic in German equities as the prospect of a second election loomed, but today Merkel's apparent preference for this option has not elicited much of a reaction, even if it seems like an odd move given that a broadly similar result is likely," said IG chief market analyst Chris Beauchamp in a note.
Stock movers: Aggreko PLC shares (AGK.LN) slid 10% after the supplier of generators and chillers said quarterly revenue at its power solutions utility division fell 11%, stemming from its business in Argentina. The company did maintained its full-year guidance.
EasyJet (EZJ.LN) bounced up 6.6% after the low-cost airline said passenger traffic rose 10% in fiscal 2017 (http://www.marketwatch.com/story/easyjet-net-profit-down-24-passenger-traffic-up-2017-11-21) and that forward bookings for the first quarter of 2018 are ahead of last year. Net profit for the full year fell 24% to GBP325 million ($430 million). The stock was on track for its biggest daily gain in four years.
Volkswagen (VOW.XE) leapt 4.3%, trading near the top of the Stoxx 600 and adding to Monday's rise of 4.2% after the car maker raised its mid-term sales and profit forecast.
Babcock International Group PLC (BAB.LN) dropped 6%, with the defense contractor saying a U.K. government review may delay the introduction of large programs to upgrade some land-based military equipment.
Economic data: The U.K. government borrowed more in October than it did a year ago (http://www.marketwatch.com/story/uk-public-borrowing-increases-in-october-2017-11-21) as price growth pushed up the cost of servicing inflation-linked debt, according to the Office for National Statistics. Britain's borrowing increased by GBP500 million to GBP8 billion. The figures arrived before the U.K. government presents its budget on Wednesday.
(END) Dow Jones Newswires
November 21, 2017 06:38 ET (11:38 GMT)