By Peter Nurse
Investing.com - European stock markets traded higher Friday, helped by a series of positive corporate earnings after the Federal Reserve concluded its latest policy-setting meeting.
At 3:50 AM ET (0850 GMT), the DAX in Germany traded 0.2% higher, the CAC 40 in France rose 0.8% and the U.K.’s FTSE 100 climbed 0.5%.
The second-quarter corporate earnings season has been largely positive in Europe as companies benefit from the gradual removal of Covid restrictions as vaccination programs kicked in.
Royal Dutch Shell (LON:RDSa) stock rose over 3% after the oil major raised its dividend by almost 40% and said it will buy back $2 billion of shares, with its earnings boosted by stronger oil prices.
Airbus (PA:AIR) stock rose 3.9% after the world’s largest commercial planemaker sharply raised its forecasts for full-year deliveries and earnings, Anglo American (LON:AAL) stock climbed 3.7% after the miner increased its stock buyback program by another $2 billion, and ArcelorMittal (NYSE:MT) stock rose 4.4% after the steelmaker boosted its guidance for global steel demand after its best quarter since 2008.
Telecoms equipment maker Nokia (HE:NOKIA) also continued its rocket-like ascent, rising 7.1% after raising its profit forecast for the second time in quick succession.
On the flip side, Credit Suisse (SIX:CSGN) stock dropped 3.9% after the Swiss banking giant posted a 78% fall in second-quarter net profit, hit by a sharp drop in its investment banking revenues. The bank also revealed that an independent external investigation into the Archegos scandal showed that it had failed “to effectively manage risk” but it had not been involved in any “fraudulent or illegal conduct”.
European markets had received a positive handover from Asia after reports that Chinese authorities tried to calm market fears about a regulatory clampdown by calling banks and investors overnight.
Additionally, Federal Reserve Chairman Jerome Powell indicated in his press conference, following the conclusion of the U.S. central bank’s latest two-day policy meeting, that the U.S. economy still had to make substantial progress on jobs before any form of tapering.
This dovish tone would also have provided some comfort for a market fretting about high levels of inflation and the potential of central banks dialing down monetary support.
In economic news, Germany's seasonally-adjusted jobless total fell by 91,000 in July, far more than expected and driving the unemployment rate down to 5.7%, its lowest in 14 months.
German inflation data for July are due later in the session, but eyes will also be on the release of the minutes of last week's European Central Bank meeting.
Elsewhere, oil prices rose Thursday, helped by U.S. crude supplies falling to their lowest level since January 2020, resuming their downward trend after last week’s surprise build.
Data from the U.S. Energy Information Administration, released late Wednesday, showed that crude inventories dropped by just over 4 million barrels during the week to July 23.
These stocks rose for the first time in nine weeks the previous week, prompting concerns that demand was peaking in the world’s largest consumer.
At 3:50 AM ET, U.S. crude futures traded 0.8% higher at $73.00 a barrel, while the Brent contract rose 0.6% to $74.33.
Additionally, gold futures rose 0.9% to $1,816.55/oz, while EUR/USD traded 0.2% higher at 1.1869.