European shares jump to fresh record after US inflation data (updated)

TAG Immobilien AG

12/03/2024 09:55

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        * 
      STOXX 600 jumps 1%
    

        * 
      Porsche rallies after initial lukewarm response to results
    

        * 
      U.S. consumer prices rise in February
    

        * 
      Data confirms German inflation eased in Feb
    

        * 
      Wacker Chemie rises on better than expected Q1 guidance
    

  
 (Updated at 1650 GMT)
    By Amruta Khandekar and Khushi Singh
       March 12 (Reuters) - European shares closed at a record
high on Tuesday, led by automakers and banks, as traders stuck
to bets on an interest rate cut by the Federal Reserve in June
following keenly awaited inflation data.
    The pan-European STOXX 600  .STOXX  closed up 1% after
paring gains following the release of U.S. consumer price data.
        Headline prices 
    increased
     solidly in February on higher costs for gasoline and
shelter, though the rise in the annual core figure, which
excludes volatile food and energy prices, was the smallest since
May 2021.
  
        Based on the report, traders stood pat on bets that the
Fed will begin its easing cycle in June.
  
        Market participants could be drawing relief from the
slight easing in core inflation, said Stuart Cole, chief
economist at Equiti Capital.
  
    The STOXX 600 has rallied to new heights in 2024 on
expectations the European Central Bank will initiate rate cuts
in June after recent slowdown in inflation in the euro zone.
    Germany's DAX index  .GDAXI  ended at a fresh record high
after data confirmed domestic inflation eased in February to
2.7%.
    "I think the ECB will be going first," said Cole, referring
to the timing of the first rate cut.
        "But I am hesitant regarding the (Fed). They are so
cautious about getting the inflation argument wrong again, they
are naturally bent on being over-cautious."
  
    French blue-chip shares  .FCHI  also rose to an all-time
peak, while UK's FTSE 100  .FTSE  scaled its highest level since
May 2023.
        Europe's automobile index  .SXAP  jumped 2.4%, boosted
by a 11.5% advance in Porsche  P911_p.DE  as traders 
    bought
     the stock following an initial lukewarm response to results
from the German sportscar maker.
  
        Rate-sensitive banking stocks  .SX7P  climbed 1.9%,
clocking their biggest daily percentage gain in five months.    
  
    Shares in Wacker Chemie  WCHG.DE  climbed 5.7% after the
chemicals maker forecast first-quarter outlook above market
estimates, driven by a stronger order intake especially in
silicone business.
    British homebuilder Persimmon  PSN.L  fell 3.7% after
missing profit expectations and warning of subdued market
conditions through 2024.
    TAG Immobilien  TEGG.DE  shares shed 3.1% after the landlord
swung to a loss in 2023 during the German property crisis and
suspended its dividend.

 (Reporting by Khushi Singh and Amruta Khandekar in Bengaluru;
Editing by Sherry Jacob-Phillips, Saumyadeb Chakrabarty and
Richard Chang)
 ((Khushi.Singh@thomsonreuters.com))