European shares advanced 1 per cent on Friday, on track to log gains for a fourth consecutive session and clawing back nearly all of their losses for the week following a global stocks rout on fears of a US recession.
The continent-wide STOXX 600 index rose 1 per cent, regaining the key 500 mark. It is set for its longest winning streak since May 15.
The US jobs report on Thursday helped calm investor nerves after July’s downbeat labour market print that fuelled worries of a prolonged slowdown in the world’s largest economy, leading to a financial market selloff.
The French CAC 40, Germany’s DAX, Spain’s IBEX 35 and Britain’s FTSE 100 all gained between 0.6 per cent and 1.2 per cent.
“Investors are buying the dip.. however, with the lack of liquidity in markets, we could see more volatility in the coming months and it could mean that the stock markets could take a step back,” said Teeuwe Mevissen, senior macro strategist at Rabobank.
On the data front, German inflation rose in July to 2.6 per cent, confirming preliminary data, while Italian EU-harmonised consumer prices (HICP) fell 0.9 per cent month-on-month in July.
The Italian benchmark FTSE MIB gained 0.9 per cent
All of European sub-indexes were trading in the green, with the real estate sector leading the charge, boosted by a 4.8 per cent gain in LEG Immobilien, one of Germany’s largest listed landlords, after it posted a smaller second-quarter loss.
Travel and leisure ticked 2.1 per cent higher as Entain and Ryanair gained, with the Irish airline announcing that it would buy back up to 800 million euros ($872.5 million) of its shares.
Basic resources gained 2.1 per cent in tandem with base metal prices that rebounded on US economic data.
Among other notable moves, Lotus Bakeries jumped around 7 per cent after the Belgian snack food company reported higher first-half revenue and earnings.
UK’s drugmaker Indivior slipped 3.1 per cent to the bottom of STOXX 600 after brokerage Jefferies cut its price target to 1,800p from 2,390p.
