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European stocks perked up further on Friday, benefiting from gains in luxury goods makers and travel-related companies and gains in U.S. stocks after better-than-expected jobs data.
The Stoxx Europe 600
SXXP,
rose 0.3% to 484.55, poised for its fifth-straight fresh record close, after banging out new highs all week. The index closed at 483.21 on Thursday. For the week, the Stoxx 600 is up 1.9%, which will be the fifth-straight weekly win in a row.
Of the major regional indexes, the German DAX
DAX,
gained 0.3%, the French CAC 40
PX1,
jumped 0.9% and the U.K. FTSE 100
UKX,
increased 0.4%. The euro
EURUSD,
and pound
GBPUSD,
were both lower against a stronger U.S. dollar
DXY,
The pound also continued to lose ground after surprise inaction by the Bank of England on Thursday.
Read: Pound falls near September lows as Bank of England surprise continues to reverberate
Fresh data showed German industrial production fell in September for the second straight month as supply-chain bottlenecks weighed on factory output.
Among stocks on the move, drugmakers were lower, with shares of AstraZeneca PLC
AZN,
AZN,
fell 1.9% and Roche
ROG,
fell 1.3%. Novo Nordisk
NVO,
NVO,
shares fell 3%.
Read: Pfizer shares soar after data finds COVID antiviral reduced risk of death or hospitalization by 89% in high-risk adults
France’s CAC 40 was lifted by a 3% gain for shares of luxury goods maker Kering
KER,
and 2.5% gain for rival LVMH Moët Hennessy Louis Vuitton
MC,
The rest of the sector was also up, with Hermès International
RMS,
shares up 2%, Christian Dior
CDI,
stock up 2%.
Piral Dadhania, analyst at RBC Capital, said luxury goods companies have benefited this week from +10% -15% price hikes on two of privately-owned Chanel’s iconic women’s handbags. The sector has also held up well in the third quarter and through October, despite tougher comparisons, China COVID disruption and a moderating economic environment, to name a few, the analyst said.
“The broader luxury sector should benefit from Chanel’s most recent price increases, as it creates some headroom in the coming months/quarters, even if we do not expect most brands to take as aggressive an approach,” said the analyst, who noted that Louis Vuitton hiked prices 6% in October for 1/3 of its handbag SKU mix, a brand that has benefited, according to a management’s third-quarter earnings call.
The banking sector was higher, led by HSBC
HSBC,
HSBA,
which was up over 1%.
Also climbing was the travel sector, after well-received results from International Consolidated Airlines
IAG,
with those shares up 2.5%. The company reported positive operating cash flow for the first time since the start of the pandemic.
Gains spread across the sector, with cruise group Carnival
CUK,
CCL,
up 7%, travel group TUI
TUI,
rose over 5%, while airlines Deutsche Lufthansa
LHA,
gained 5% and Ryanair
RYA,
3.5%.
