European stocks gained on Friday, boosted by upbeat corporate updates and optimism about a coronavirus treatment.
The Stoxx Europe 600 Index closed 0.9% higher, with banks and autos leading gains, up more than 2% each. The benchmark extended its advance in afternoon trading after Gilead Sciences Inc. said its remdesivir virus treatment is associated with a 62% reduction in death risks compared with standard care, according to a new analysis of trial data.
European shares have been trading in a tight range since mid-June, as investors weighed the unprecedented central bank and government stimulus against the effect of the pandemic on the economy. Caution ahead of the start of the second quarter earnings season, and rising virus infections in America have added to the worries.
“Despite ongoing volatility, we continue to suggest investors stick to their long-term strategic equity allocations, but react to the larger swings by frequently rebalancing,” says Richard Flynn, U.K. managing director at Charles Schwab. “This allows portfolios to stay in gear by trimming into strength and adding into weakness, rather than trying to time short-term peaks and troughs.”
Among notable movers, Danish brewer Carlsberg A/S jumped 6.4% after reporting preliminary earnings, while satellite communications provider SES SA surged after an upgrade from Goldman Sachs Group Inc.
Sentiment in the region was also helped after the European Union made a new effort to achieve its economic stimulus plan by offering sweeteners to critics of the package.
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