Europe midday: Shares up as Delivery Hero provides a boost
European shares made gains by midday on Friday as investors digested the previous day's larger-than-expected interest rate rise by the European Central Bank.
The pan-European Stoxx 600 index was up 0.53% with all major bourses entering positive territory. Italian shares rallied, despite the resignation of Prime Minister Mario Draghi after the collapse of his national unity government.
Investors were taken by surprise after the ECB raised rates by 50 basis points, which sent shares lower yesterday.
In the UK, official data showed retail sales fell in June amid the cost-of-living crisis, with sales down 0.1% on the month following a revised 0.8% fall in May and versus expectations for a 0.3% decline. Retail sales volumes were 2.2% above their pre-Covid February 2020 levels, but down over the past year.
The data showed that the Queen’s Platinum Jubilee failed to give shops the boost many had expected. While food sales volumes rose by 3.1% thanks to the celebrations, non-food store sales fell 0.7% over the month. Clothing store sales were down 4.7%, while household goods sales declined 3.7%.
“The challenging macroeconomic backdrop is weighing on consumer spending, laid bare by another decline in retail spending. Sky high petrol and diesel prices have dampened demand for fuel while households are cutting back on discretionary spending as the cost-of-living crisis bites,” said Victoria Scholar at Interactive Investor.
In equity news, shares in food takeaway delivery companies surged after Delivery Hero reported higher gross merchandise value. Just Eat Takeaway and meal kit outfit HelloFresh were gainers on the news.
Lloyd's of London insurer Beazley rose after the company raised its full-year profitability outlook.
Danske Bank fell 2.6% as the lender axed dividends, while Swiss elevator and escalator manufacturer Schindler slipped 4.0% on cutting 2022 revenue guidance.
Aluminium-maker Norsk Hydro rose 4.1% on proposing an extra dividend and offering share buybacks.