European Stocks Surge Up to 3 Percent as Democrats Win Congress

(MENAFN) European equities closed sharply higher on Wednesday as Democratic victories in the US Congress combined with stronger-than-expected corporate earnings and a steep slide in oil prices to fuel a broad rally.

The pan-European Stoxx Europe 600 climbed 1.91% to 658.02. Spain’s IBEX 35 led the major regional benchmarks, surging 3% to 19,370.90, while Germany’s DAX advanced 2.38% to 26,479.33.

Italy’s FTSE MIB added 2.18% to 51,031.02, France’s CAC 40 rose 1.96% to 8,177.89, and the UK’s FTSE 100 gained 1.79% to 10,829.21. By the close of European trading, the euro was up 0.32% against the dollar at $1.123.

Investors read the Democratic wins in both the Senate and the House of Representatives as a constraint on President Donald Trump’s ability to push his legislative agenda through.

Oil prices also fell hard, easing worries over energy costs. Brent crude dropped nearly 9% to $94.47 a barrel. Earlier in the day, Eurostat estimated that eurozone annual inflation accelerated to 4% in October from 3.8% in September, with energy prices running 20.8% above year-earlier levels.

Corporate earnings lift individual stocks
Heidelberg Materials jumped 9.5% after the German building materials group reported a 9% increase in third-quarter profit from current operations, to €1.28 billion ($1.44 billion). Revenue rose 10% to €6.41 billion, driven by growth in Europe and North America.

Online marketplace operator Scout24 gained 6.7% after lifting its revenue forecast. BMW shares rose 5.5%, even as the automaker’s third-quarter operating profit fell by nearly 30% amid weakness in China. Auto supplier Continental added 5.2%.

Health care group Fresenius climbed 5% after raising its full-year outlook. Property company Vonovia gained 3.6% on higher rental income, and German energy company Uniper rose 3.4% after increasing its forecast.

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