Aveva shares soar after Schneider Electric agrees to take control
European stocks gained ground Tuesday, with a taste for risk among investors perking up even as concerns about North Korea's nuclear testing linger.
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The Stoxx Europe 600 index rose 0.3% to 375.27, with only the financial and telecom sectors showing small declines. Advancers were led by the technology and oil and gas sectors.
The index on Monday fell 0.5%, (http://www.marketwatch.com/story/european-stocks-drop-after-north-korea-tests-its-nuclear-arsenal-2017-09-04) snapping a three-session winning streak, after North Korea conducted a nuclear bomb test and was said to be preparing for a possible launch (http://www.marketwatch.com/story/north-korea-is-getting-ready-for-another-possible-icbm-launch-says-south-korea-2017-09-04) of another intercontinental ballistic missile.
The moves Tuesday came "as U.S. rhetoric on North Korea tries to shift focus to getting UN counterparts on board with even harsher sanctions, all the while maintaining the option of military intervention," said analysts at Accendo Markets.
See:Here's a win-win solution for the U.S. and China on North Korea (http://www.marketwatch.com/story/heres-a-win-win-solution-for-the-us-and-china-on-north-korea-2017-09-04)
"Add to this ... positive China PMI services (http://www.marketwatch.com/story/china-caixin-services-pmi-rises-breaks-losing-run-2017-09-05) and some more [mergers and acquisitions], and risk appetite remains refreshingly upbeat in light of the geopolitical uncertainty in play," they said.
Stock movers: Shares in Schneider Electric SE (SU.FR) added 0.5% after the French industrial group reached a deal to take control of British engineering software maker Aveva Group PLC (http://www.marketwatch.com/story/schneider-electric-takes-controling-stake-in-aveva-2017-09-05). Off the Stoxx 600, shares of Aveva Group PLC (AVV.LN) soared 29%.
Shares of Merck KGaA (MRK.XE) (MRK.XE) climbed 3.3% in Frankfurt after the German pharmaceutical major put its consumer health business up for sale (http://www.marketwatch.com/story/merck-rises-2-after-health-business-is-put-up-for-sale-2017-09-05).
Away from the Stoxx 600, Cellectis SA (ALCLS.FR) tumbled 29% after the U.S. Food and Drug Administration ordered the French cell therapy specialist to put a cancer-drug trial on hold.
Economic data: European stocks overall gained as the euro fell. The shared currency dropped below $1.19 after IHS Markit's gauge of services activity in the eurozone showed a decline in August.
The services purchasing managers' index came in at 54.7, slightly slower than the preliminary estimate of 54.9 and well below July's reading of 55.4. The composite output index at 55.7 was a touch slower than the 55.8 flash reading.
The composite PMI for the eurozone was unchanged (http://www.marketwatch.com/story/eurozone-economic-growth-to-slow-pmi-indicates-2017-09-05) at 55.7 in August. That was below the preliminary estimate of 55.8 and the average reading for the second quarter.
The prospect of a slowdown in eurozone economic activity may bolster the case for the European Central Bank to continue its bond-buying program after December. The ECB will release its latest policy decision on Thursday.
Indexes: Germany's DAX 30 index put on 0.7% to 12,194.01, and France's CAC 30 index picked up 0.1% to 5,114.35.
In London, the FTSE 100 advanced 0.2% to reach 7,416.42.
(END) Dow Jones Newswires
September 05, 2017 05:53 ET (09:53 GMT)