European stocks rise at Kering’s expense; British indices are shining

Jul 19 (Reuters) – European stocks rallied on Wednesday as shares of Kering, the owner of Italian brand Gucci, surged after a change in leadership at the fashion house. London stock indices surged after the release of data indicating a stronger than expected slowdown in inflation in the UK.

The pan-European STOXX 600 was up 0.33% at 13:19 GMT.

Kering shares rose 5.45% after the French luxury goods maker announced on Tuesday that Gucci CEO Marco Bizzari would step down effective Sept. 23 and appoint industry veteran Jean-Francois Palu as interim head of the Italian brand.

An additional stimulus to growth in the markets was the data on inflation slowdown in the UK in June to the lowest level in over a year.

London’s export-oriented FTSE 100 index gained 1.53% on the weaker pound after the release of inflation data, which also spurred a rally in price-sensitive property equities.

The European real estate sector grew by 4%, showing the best performance among sector indicators.

Second-quarter STOXX 600 earnings are expected to be 9.2% lower than the same period last year, according to Refinitiv IBES.

“In Europe, strong returns have been a driving force for broader equity markets this year, but we doubt this will continue into the second half of the year,” said Laura Cooper of BlackRock. “We steer clear of luxury stocks and prefer cyclical stocks where lower returns are already priced in, such as in the energy sector.”

While investors’ attention has shifted to corporate reporting, they are also watching signals from central banks to assess whether major regulators may stop raising interest rates in the near future after recent evidence of slowing US inflation.

ASML Holding rose 0.48% after posting an encouraging sales forecast for the chipmaker.

The original message in English is available under the code: (Amruta Khandekar)


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