Europe close: Stocks rally as Mideast tensions fail to spill over
Stocks across the Continent overcame an early bout of selling on Wednesday, after Iran apparently chose not to ratchet up tensions with Washington even further with its retaliatory strikes against US bases in Iraq overnight, with America following suit.
No US servicemen were killed in the attacks against a base located in Erbil, in the Iraqi region of Kurdistan, and another west of Baghdad, possibly opening a small window of opportunity to de-escalate the hostilities between the two countries, which according to many observers had recently reached a potentially critical point.
"Stock markets are broadly higher as we approach the close of trading. The markets were volatile today on account of the Iranian attacks on Iraqi bases," said David Madden, market analyst at CMC Markets UK.
"The Iranian government hinted that it is not interested in a full-scale war with the US. Tensions might be on the cusp of deescalating, and we have seen some confidence come back into stocks."
Germany's Dax jumped 0.71% to 13,320.18 while the French Cac-40 was up by 0.31% at 6,031.0 and the FTSE Mibtel put on 0.46% to 23,832.02.
In parallel, February gold on COMEX dipped 0.30% to $1,569.50/oz., having earlier risen as high as $1,613.30/oz., and crude oil futures slid by over 4.0%.
Providing a further small boost to investor sentiment on both sides of the Atlantic, consultancy ADP's US private sector payrolls report for December surprised to the upside, printing at 202,000 (consensus: 160,000) - for the largest initial print since April.
On the corporate side of the equation, shares of Ubisoft topped the leaderboard on news that Apple TV+ would offer all episodes of its live action series which was jointly-produced with the games designer.
Atlantia was in the third spot following reports that Rome was looking at ways to settle the dispute with tollroad operator Autostrade.
To take note of, stock in Deutsche Bank was rising to its highest levels since April alongside.
To the downside, NMC Health plummeted almost 16% after two of its top shareholders announcing the night before that they would sell-down part of their stakes in order to repay personal debts.
Rotork and Spectris meanwhile were felled by downgrades out of Bank of America.
The latest economic data out of the single currency bloc was mixed although there were one or two small positives to be had, according to economists.
An index of economic sentiment in the Eurozone referencing December surprised to the upside, increasing from 101.2 for November to 101.5 (consensus: 101.4), thanks to more upbeat consumers and a tentative rebound in confidence within the services sector, said Claus Vistesen at Pantheon Macroeconomics.
However, the latest factory orders data in Germany "wasn't pretty", Vistesen added.
Figures from the Federal Office of Statistics showed that manufacturing orders in the euro area's largest economy slumped at a month-on-month pace of 1.3% month in November (consensus: +0.2%), as a 1.6% jump in domestic orders failed to offset a 3.1% drop in export orders.
On the other hand, the same economist also said "[the data] indicate that growth in new orders shouldn’t fall further, but they also point to little in the way of a rebound at the start of the year."
CAC 40 - Risers
Sodexo (SW) 107.25 +2.48%
Michelin (ML) 110.25 +2.04%
Vinci (DG) 99.92 +1.92%
Airbus SE (AIR) 134.38 +1.80%
Essilorluxottica (EL) 138.90 +1.35%
Dassault Systemes (DSY) 150.50 +1.21%
ArcelorMittal SA (MT) 15.24 +1.18%
Societe Generale S.A. (GLE) 31.77 +0.99%
Hermes International (RMS) 684.20 +0.88%
Valeo (FR) 32.75 +0.74%
CAC 40 - Fallers
TECHNIPFMC (FTI) 18.50 -2.68%
Danone (BN) 72.56 -2.03%
Peugeot (UG) 20.94 -1.13%
Pernod Ricard (RI) 159.45 -0.69%
Orange. (ORA) 13.11 -0.68%
Veolia Environnement (VIE) 23.58 -0.51%
Renault (RNO) 42.63 -0.41%
Vivendi (VIV) 25.75 -0.39%
Capgemini (CAP) 109.05 -0.27%
Publicis Groupe Sa (PUB) 42.19 -0.17%