By Sara Sjolin, MarketWatch
LONDON (MarketWatch) — European stocks rose Wednesday, finding support in euro-zone industrial data and a U.S. retail-sales report, while earnings reports from majors Société Générale SA and Heineken NV also drew attention.
The Stoxx Europe 600 index /zigman2/quotes/210599654/delayed XX:SXXP +0.83% gained 0.4% to close at 288.27, adding to a 0.5% gain from Tuesday.
Peugeot may be overly optimistic
The French car maker's management is upbeat despite a $6.74 billion loss last year. But the future isn't entirely in Peugeot's control. (Photo: Getty Images)
“At the moment, the rally seems to be built on early signs of a recovery and investors have moved back into risk assets fairly rapidly,” said Victoria Clarke, economist at Investec Securities.
“It’s difficult to see what will stop this run with things a lot quieter in Europe. There’s the Italian election [on Feb. 24-25], which could be a little blip, but I don’t see it as a show stopper,” she said.
Among notable movers in Europe, shares of Heineken NV /zigman2/quotes/205347870/delayed NL:HEIA +1.21% jumped 5.7% after the brewer said 2012 revenue and profit were boosted by emerging markets and that it expects volume and revenue growth to continue in 2013. See: Heineken upbeat on volume, sales for 2013.
Kabel Deutschland Holding AG DE:KD8 0.00% rallied 8.8% after a news report, citing unnamed sources, said Vodafone Group PLC /zigman2/quotes/202484985/delayed UK:VOD +0.32% /zigman2/quotes/202862751/composite VOD -0.79% was considering a possible takeover of the German cable network operator. A representative from Vodafone said the company doesn’t comment on market rumors. Shares of Vodafone fell 1.1%. See: Vodafone may buy Kabel Deutschland: report.
Car maker Peugeot SA /zigman2/quotes/203546414/delayed FR:UG +0.83% surged 7.3%, as it confirmed its 2013 free-cash-flow guidance, but posted a 576 million euros ($776.45 million) full-year operating loss.
On a downbeat note, ING Groep NV /zigman2/quotes/203351007/delayed NL:INGA -3.80% fell 4%. The Dutch bank reported fourth-quarter results below expectations and said it would slash 2,400 jobs to cut costs.
For the broader European market, investors trained their attention on data showing industrial production in the euro zone rose 0.7% in December, beating expectations of a 0.3% rise.
“Industrial production rose across the euro area in December, but the increase follows steep falls in each of the previous three months and care should therefore be taken in interpreting this single data point as the start of a recovery,” said Chris Williamson, chief economist at Markit.
“The worry is that signs of improvements are by no means universal, and skewed heavily towards Germany. Of greatest concern is France, which appears to be bucking the wider trend and suffering an increased rate of decline at the start of 2013,” he said.
In the U.S., data showed retail sales grew 0.1% in January, slightly beating market expectations of a flat reading. Excluding the auto sector, retail sales climbed 0.2%. See: U.S. retail sales inch up 0.1% in January
U.S. stocks traded mixed on Wall Street. See: U.S. stocks rise; GE, Comcast rally after deal
Australian stocks finished at the highest level in almost 4½ years, helped by corporate earnings. See: Asia markets end mostly up; earnings lift Sydney.
Bank of England inflation report
Closer to home, the Bank of England raised its forecast for inflation, signaling it will overshoot its 2% target over the two-year forecast period and said the economy is likely to post slow growth. BOE Governor Mervyn King further warned that tightening policy in an attempt to bring inflation to target posed the risk of “derailing the recovery.” See: BOE's King: Tighter policy could derail recovery.
The British pound slipped to a six-month low versus the dollar in the wake of the report.
The FTSE 100 index /zigman2/quotes/210598409/delayed UK:UKX +1.02% rose 0.3% to 6,359.11, with miners among major advancers. Shares of Rio Tinto PLC /zigman2/quotes/208934945/delayed UK:RIO +0.71% /zigman2/quotes/200083756/delayed AU:RIO +0.18% /zigman2/quotes/202627887/composite RIO -0.15% rose 2.4% and BHP Billiton PLC /zigman2/quotes/208108397/composite BHP -0.25% /zigman2/quotes/201448516/delayed AU:BHP +0.61% added 2%. Read more about London stocks.
Outside the major index in London, shares of beverage firm Britvic PLC /zigman2/quotes/208055220/delayed UK:BVIC +1.42% sank 8.7%, after the U.K.’s Office of Fair Trading said it referred the proposed acquisition by A.G. Barr PLC /zigman2/quotes/206898740/delayed UK:BAG 0.00% to the Competition Commission because of concerns that competition between certain brands would be reduced. See: Barr-Britvic merger under further investigation
In Paris, shares of oil group Total SA /zigman2/quotes/206172043/delayed FR:FP +0.79% /zigman2/quotes/201824152/composite TOT +0.35% inched 0.4% higher. The French firm said its fourth-quarter earnings were boosted by higher refining margins and crude prices. See: Total earnings boosted by refining, crude prices.
Also in France, shares of Société Générale SA /zigman2/quotes/206663756/delayed FR:GLE +0.05% lost 3.6%. The bank posted a loss for the fourth quarter partly due to an accounting charge, while it vowed to roll out a restructuring plan this year that will boost revenue. See: Société Générale books loss on accounting charge.
The CAC 40 index /zigman2/quotes/210597958/delayed FR:PX1 +0.90% gained 0.3% to 3,698.53.
And in Germany, the DAX 30 index /zigman2/quotes/210597999/delayed DX:DAX +0.79% rose 0.7% to 7,711.89, with car makers on the rise. Shares of Daimler AG /zigman2/quotes/205332368/delayed DE:DAI +0.78% rose 1.9% and BMW AG /zigman2/quotes/209548467/delayed DE:BMW +0.11% gained 0.9%.
Outside the major indexes, shares of FLSmidth & Co. AS /zigman2/quotes/204269275/delayed DK:FLS +0.04% jumped 6.6%, after Citigroup lifted the industrial-plant maker to buy from neutral.