Breaking News
Investing Pro 0
Cyber Monday Extended SALE: Up to 60% OFF InvestingPro+ CLAIM OFFER

European shares supported by tech, but mark worst month since late-2020

Economy Feb 01, 2022 02:16
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, January 28, 2022. REUTERS/Staff

By Anisha Sircar and Ambar Warrick

(Reuters) -European shares ended higher on Monday as tech stocks jumped from eight-month lows, although concerns over policy tightening, inflation and geopolitical tensions saw the STOXX 600 mark its worst month since late-2020.

The pan-European STOXX 600 rose 0.7%, with tech stocks up 3.5%. But the index lost 3.9% in January.

Technology stocks fell 12% in January, their worst month since the height of the 2008 financial crisis, as investors discounted future earnings from the sector on expectations of higher lending rates.

"Investors will continue to grapple with higher rate expectations and geopolitical risks on one side, set against robust macroeconomic and corporate fundamentals on the other - as a result, volatile trading looks set to continue," said Mark Haefele, chief investment officer at UBS Global Wealth Management.

However, "the sharp fall in many high-quality tech firms is already creating opportunities for longer-term investors to add exposure," Haefele said.

Concerns over gas supplies to western Europe persisted as Britain warned it was "highly likely" that Russia was looking to invade Ukraine and the head of NATO said the continent needed to diversify its energy supplies.

Rising oil prices saw energy stocks largely outpace their European peers in January, rising 8.6%. Higher bond yields also supported banks, which added 7.4%.

The focus will be on the European Central Bank and the Bank of England meetings on Thursday, which are expected to offer clues to their policy paths after the U.S. Federal Reserve's hawkish tone last week led to gyrations across markets.

No immediate policy action is expected since the ECB in December laid out plans to wind up its 1.85 trillion euro ($2.09 trillion) pandemic stimulus scheme by end-March, but price pressures remain strong and the markets are keen for a sense of whether the ECB is getting closer to a more hawkish stance.

Meanwhile, the markets expect a 50 basis-point rate increase from the Bank of England, its second hike in a row. [BOEWATCH] (L)

Vodafone (LON:VOD) gained 1.9% after saying it would work with Intel (NASDAQ:INTC) and other silicon vendors on designing its own chip architecture to drive innovation and efficiency in nascent OpenRAN network technology.

KPN, the largest telecom provider in the Netherlands, added 1.0% after announcing a share buyback programme and a higher dividend over 2022.

Italian energy services group Saipem plunged 30.2% after issuing a profit warning on deteriorating margins due to the pandemic and higher raw material costs.

European shares supported by tech, but mark worst month since late-2020
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email