Europe Stocks Rise as Auto, Chemical Shares Outweigh Oil Slump
(Bloomberg) -- European stocks rose for a second day as a rally in carmakers and chemical companies outweighed decline in raw-material producers.
The Stoxx Europe 600 Index gained 0.2 percent at the close of trading. The gauge jumped as much as 0.8 percent earlier, paring gains after the release of data showing U.S. monthly payrolls increased less than projected. The benchmark added 0.3 percent in the five days through Friday, ending a two-week streak of declines.
- Carmakers were the second-biggest gainers in the Stoxx 600 after U.S. auto sales in May mostly beat market estimates. Chemical stocks advanced the most in more than five weeks.
- In addition to worse-than-projected May payrolls data, figures for the previous two months were also revised lower, even as the unemployment rate fell to a 16-year low. Traders are still fully pricing in a U.S. interest-rate increase in June.
- Oil and gas stocks slipped 1.3 percent as Brent crude fell for a second week; mining companies lost 0.3 percent.
- “Today's jobs report was a mixed bag,” Kully Samra, who manages U.K. clients for Charles Schwab Corp., wrote in an emailed note. “The fall in job growth numbers may make some query the likelihood of a rate rise next month. However, one slightly disappointing month does not constitute a wholesale change in fortunes. Wider U.S. economic data remains buoyant and equity markets resilient.”
- Investors may want to buy protection as key global stock indexes haven't had a meaningful pullback in almost a year, BNP Paribas equity strategist Ankit Gheedia wrote in a note. The FTSE 100 Index hasn't had a drawdown of 5 percent or more since the global financial crisis, he said. The index closed little changed after reaching an all-time high last Friday.
--With assistance from Elena Popina
To contact the reporter on this story: Blaise Robinson in Paris at brobinson58@bloomberg.net.
To contact the editors responsible for this story: Celeste Perri at cperri@bloomberg.net, Namitha Jagadeesh, Richard Richtmyer
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