European Stocks Climb a Third Day as H&M, Ocado Boost Retailers

This content was published on September 15, 2020 - 16:04

(Bloomberg) -- European stocks rose for a third day as positive corporate updates boosted retailers and miners rose on data showing an acceleration in China’s economic recovery.

The Stoxx Europe 600 Index closed 0.7% higher, adding to its longest winning streak in a month. Retailers rallied after Hennes & Mauritz AB returned to profit and Ocado Group Plc reported a surge in sales. Miners advanced after Chinese data showed a rebound in consumption as virus restrictions eased, and a bigger-than-expected expansion in industrial production.

Investors this week are awaiting key rate decisions due from the Federal Reserve and the Bank of England. For the Stoxx 600, which has been stuck in a 20-point range since June, the 200-day moving average remains the ceiling to watch. The benchmark crossed above it in intraday trading today.

“There’s going to be volatility in markets but generally we’re pretty positive on equities,” Sharon Bell, a European strategist at Goldman Sachs Group Inc., said in a Bloomberg TV interview with Matt Miller and Anna Edwards. “The assumptions we’re making is that you get a vaccine at some point, this becomes more widely available in the middle of 2021, that rates stay very, very low, central banks stay extremely supportive and you see earnings revisions move up.”

Investors are “rotating” rather than “chasing” stocks following the rebound since March, according to Bank of America Corp.’s September fund manager survey. A net 51% of respondents said a bull market has started, versus just 25% in May.

Among notable movers, Fiat Chrysler Automobiles NV climbed 9% after agreeing to shrink a dividend tied to its merger with PSA Group by about $3.1 billion. The reduction will be partially offset by the company’s investors getting a stake in French supplier Faurecia SE, whose shares tumbled 6.6%.

©2020 Bloomberg L.P.

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