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Sept. 28, 2017, 1:24 p.m. EDT

European stocks notch 2-month high, but bank stocks pare heftier gain

Ryanair shares retreat

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By Carla Mozee, MarketWatch


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H & M shares were under pressure Thursday.

European stocks booked their sixth straight win Thursday on the way to a two-month high, but bank stocks pared bigger gains as market momentum surrounding prospects for U.S. tax cuts ebbed.

Finishing firmly in the red were shares of Swedish apparel retailer H&M after a disappointing earnings report, while Ryanair Holdings PLC shares were dogged by troubles stemming from the carrier’s ongoing cancellation of hundreds of flights.

The Stoxx Europe Index /zigman2/quotes/210599654/delayed XX:SXXP -1.30%  closed up 0.2% to 386.36 after a choppy trading session. But that was enough to mark its longest winning streak since late April, according to FactSet data. Thursday’s settlement was also the highest since July 17. Industrial and tech stocks led gainers, while telecom and utility shares, among others, fell.

The index on Wednesday closed up 0.4%, aided by advances for bank stocks.

Bank stocks on Thursday ended higher overall, but the 1% intraday rise for the Stoxx Europe 600 Banks Index /zigman2/quotes/210599339/delayed XX:SX7P -0.19%  was slimmed to a rise of 0.1%. Germany’s Deutsche Bank AG /zigman2/quotes/205584254/delayed DE:DBK +0.55%   /zigman2/quotes/203042512/composite DB -3.66%  closed up 2.7%, off session peak, and Spain’s Banco Santander SA /zigman2/quotes/205677933/delayed ES:SAN -1.00%  rose 0.5%. France’s Societe Generale SA /zigman2/quotes/206663756/delayed FR:GLE -0.14% closed up 0.4% and the U.K.’s Barclays PLC /zigman2/quotes/208409333/delayed UK:BARC -1.62%   /zigman2/quotes/206581728/composite BCS -1.66%  tacked on 1%.

Bank stocks have risen this week as investors priced in the prospect of higher interest rates, as those mean that banks can charge more for their loans.

U.S. President Donald Trump’s tax cuts proposal presented on Wednesday was seen as reinforcing expectations for a rate rise in December.

“European markets have seen marginal gains today, as the optimism surrounding Trump’s tax plans seems to have run out of steam. With sharp gains for the likes of EURUSD and GBPUSD, it is clear that despite the potential bounty for the U.S. economy, there is a great deal of skepticism over the timing and ability to deliver such reforms,” IG Market Analyst Joshua Mahony wrote in a note.

The euro /zigman2/quotes/210561242/realtime/sampled EURUSD +0.2204%   and the pound /zigman2/quotes/210561263/realtime/sampled GBPUSD -0.2310%  marched higher during the session, and currency strength can weigh on shares of multinational companies that weigh heavily on European benchmarks.

Bank of England’s Chief Economist Andy Haldane, in a Sky News interview published late Wednesday, said a rise in borrowing costs would represent a “good news story” for the U.K. as it would reflect improvement in the British economy.

Haldane’s comments came as Boston Federal Reserve President Eric Rosengren late Wednesday said he backs ‘regular and gradual’ interest-rate rises. Federal Reserve Chairwoman Janet Yellen this week said she plans for the Fed to keep raising interest rates gradually even though inflation has softened.

Stock movers: Hennes & Mauritz AB, better known as H&M, /zigman2/quotes/208522175/delayed SE:HM.B -2.82%  fell 5.1%, the biggest fall since June. The fashion retailer’s third-quarter profit dropped 20%, missing analyst expectations, hurt by heavy price-cutting and fewer visitors to its stores.

Ryanair /zigman2/quotes/204532167/delayed DE:RY4C +0.42%   /zigman2/quotes/204098489/composite RYAAY +0.45%  was dragged down 3.7% as the airline faced legal action from a U.K. regulator, which said Wednesday that Ryanair is “persistently misleading passengers” about their rights following thousands of canceled flights across Europe.

Balfour Beatty PLC /zigman2/quotes/202863772/delayed UK:BBY -2.44%  leapt 5.6% after Peel Hunt upgraded the construction services company’s rating to buy, saying management has significantly reduced investment-related risks.

Indexes: Spain’s IBEX 35 index /zigman2/quotes/210597999/delayed DX:DAX -1.53%  fell 0.4% to 10,328.50, as the market moved closer to Sunday’s independence referendum in the Catalonia region, which includes the city of Barcelona.

Read: 5 things investors need to know about Catalonia’s independence referendum

France’s CAC 40 index /zigman2/quotes/210597958/delayed FR:PX1 -1.75%  ended up 0.2% at 5,293.77. Germany’s DAX /zigman2/quotes/210597999/delayed DX:DAX -1.53%  rose 0.4% to 12,704.65. In the U.K., the FTSE 100 index /zigman2/quotes/210598409/delayed UK:UKX -0.40%  notched a 0.1% rise at 7,322.82

/zigman2/quotes/210599654/delayed
XX : STOXX
365.68
-4.82 -1.30%
Volume: 0.00
July 14, 2020 12:50p
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/zigman2/quotes/210599339/delayed
XX : STOXX
98.20
-0.19 -0.19%
Volume: 0.00
July 14, 2020 12:50p
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/zigman2/quotes/205584254/delayed
DE : Germany: Frankfurt
8.76
+0.05 +0.55%
Volume: 33,160
July 14, 2020 12:47p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
N/A
Rev. per Employee
€417,912
loading...
/zigman2/quotes/203042512/composite
US : U.S.: NYSE
$ 9.73
-0.37 -3.66%
Volume: 5.41M
July 13, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
$20.62 billion
Rev. per Employee
$493,032
loading...
/zigman2/quotes/205677933/delayed
ES : Spain: Madrid
2.22
-0.02 -1.00%
Volume: 16.48M
July 14, 2020 12:50p
P/E Ratio
8.02
Dividend Yield
3.64%
Market Cap
€36.87 billion
Rev. per Employee
€374,762
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/zigman2/quotes/206663756/delayed
FR : France: Euronext Paris
15.38
-0.02 -0.14%
Volume: 2.15M
July 14, 2020 12:50p
P/E Ratio
4.88
Dividend Yield
0.00%
Market Cap
€11.99 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/208409333/delayed
UK : U.K.: London
117.62 p
-1.94 -1.62%
Volume: 7.62M
July 14, 2020 11:50a
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
£20.41 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/206581728/composite
US : U.S.: NYSE
$ 5.91
-0.10 -1.66%
Volume: 5.18M
July 13, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
2.44%
Market Cap
$25.84 billion
Rev. per Employee
$458,292
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/zigman2/quotes/210561242/realtime/sampled
US : Tullett Prebon
1.1371
+0.0025 +0.2204%
Volume: 0.0000
July 14, 2020 7:05a
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/zigman2/quotes/210561263/realtime/sampled
US : Tullett Prebon
1.2524
-0.0029 -0.2310%
Volume: 0.0000
July 14, 2020 7:05a
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/zigman2/quotes/208522175/delayed
SE : Sweden: Stockholm
kr 136.05
-3.95 -2.82%
Volume: 2.19M
July 14, 2020 12:50p
P/E Ratio
44.96
Dividend Yield
0.00%
Market Cap
kr227.82 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/204532167/delayed
DE : Germany: Frankfurt
10.78
+0.05 +0.42%
Volume: 240.00
July 14, 2020 11:50a
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
N/A
Rev. per Employee
€530,769
loading...
/zigman2/quotes/204098489/composite
US : U.S.: Nasdaq
$ 66.66
+0.30 +0.45%
Volume: 286,923
July 13, 2020 4:00p
P/E Ratio
20.52
Dividend Yield
N/A
Market Cap
$12.95 billion
Rev. per Employee
$624,883
loading...
/zigman2/quotes/202863772/delayed
UK : U.K.: London
256.20 p
-6.40 -2.44%
Volume: 176,643
July 14, 2020 11:39a
P/E Ratio
13.58
Dividend Yield
0.82%
Market Cap
£1.80 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/210597999/delayed
DAX
DX : Xetra Indices
12,603.54
-196.43 -1.53%
Volume: 25,083
July 14, 2020 12:50p
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/zigman2/quotes/210597958/delayed
FR : France: Euronext Paris
4,967.74
-88.49 -1.75%
Volume: 25,796
July 14, 2020 12:50p
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/zigman2/quotes/210597999/delayed
DAX
DX : Xetra Indices
12,603.54
-196.43 -1.53%
Volume: 25,083
July 14, 2020 12:50p
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/zigman2/quotes/210598409/delayed
UK : FTSE UK
6,151.57
-24.62 -0.40%
Volume: 192,014
July 14, 2020 11:50a
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Carla Mozée is a reporter for MarketWatch, based in London. Follow her on Twitter @MWMozee.

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