Christian Dior unit to be purchased by LVMH
European stocks nudged higher Tuesday, with attention turned to earnings reports and a deal involving luxury-fashion company Christian Dior a day after equities rallied on the first-round result in France's presidential election.
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The Stoxx Europe 600 rose 0.2% to 386.74, but has dipped in and out of negative territory. Health care, telecom and tech shares advanced, but basic materials, consumer services and utility stocks were down.
The benchmark on Monday jumped 2.1%, driven higher on relief among investors that centrist Emmanuel Macron won the first round of voting in the France's presidential race. Polling shows Macron is heavily favored to win his runoff election against far-right candidate Marine Le Pen on May 7.
Le Pen late Monday said she's temporarily stepping down as the leader of the National Front party (http://www.marketwatch.com/story/marine-le-pen-steps-down-as-leader-of-national-front-for-now-2017-04-25), a move seen as a way to broaden her support heading into the May 7 election.
Check out:4 things investors need to know about France's presidential runoff (http://www.marketwatch.com/story/4-things-investors-need-to-know-about-frances-presidential-runoff-2017-04-23)
In Paris, the CAC 40 index on Tuesday was up 0.1% at 5,274, but had briefly turned lower. The index powered up 4.1% on Monday to end at 5,268.85, the biggest one-day percentage gain since August 2012 and the highest close since April 2015, according to FactSet data.
Read:The market is going bonkers over France's election result -- here's how in 5 wild charts (http://www.marketwatch.com/story/the-market-is-going-bonkers-over-frances-election-result-heres-how-in-5-wild-charts-2017-04-24)
Barclays on Tuesday reiterated its overweight rating on European equities.
"We expect fund flows to be the dominant driver of European stock/sector performance hereon. A reduction in political risk, coupled with an end to the seven-year stagnation in earnings, should lead to an acceleration in foreign investor buying of European equities," Barclays strategist Denis Jose wrote in a research note.
Corporate movers: Christian Dior SE shares (CDI.FR) surged 12% after a deal was struck allowing LVMH Moët Hennessy Louis Vuitton SE (LVMUY) to buy the Christian Dior's fashion subsidiary, Christian Dior Couture, for EUR6 billion. Read: Arnaults to take full control of Christian Dior (http://www.marketwatch.com/story/arnaults-to-take-full-control-of-christian-dior-2017-04-25)
Ericsson AB (ERIC) fell 2.1% after the wireless-communications gear maker posted a hefty quarterly net loss of 10.9 billion kronor ($1.24 billion) after booking provisions, write-downs and restructuring costs. (http://www.marketwatch.com/story/ericsson-logs-hefty-loss-on-write-downs-2017-04-25)
Whitbread PLC shares (WTB.LN) sank 7.3%, at the bottom of the Stoxx 600, after the parent company of Costa Coffee and the Premier Inn hotel chains said it foresees a "tougher consumer environment than last year," (http://www.marketwatch.com/story/whitbread-lifts-dividend-as-full-year-profit-rises-2017-04-25) even as its businesses have had a good start for the year.
Indexes: Germany's DAX 30 index was up 4 points at 12,459.39. On Monday, it climbed 3.4% to finish at 12,454.98, a record closing high.
The U.K.'s FTSE 100 index was up 0.2% at 7,278.57 (http://www.marketwatch.com/story/ftse-100-edges-higher-after-rally-but-mining-stocks-hit-by-downgrades-2017-04-25).
The euro bought $1.0892 compared with $1.0868 late Monday.
Data: More eurozone banks are set to tighten standards on loans to companies (http://www.marketwatch.com/story/eurozone-banks-set-to-tighten-credit-terms-ecb-2017-04-25)in the current quarter than ease them, though most are likely to keep them unchanged, according to a quarterly survey from the European Central Bank.
(END) Dow Jones Newswires
April 25, 2017 05:30 ET (09:30 GMT)