The European STOXX 600 index recorded its largest weekly gain since March on Friday, supported by real estate stocks that are sensitive to interest rates, while signs of an end to monetary tightening strengthened sentiment.
The STOXX 600 index rose by 0.2%, also supported by optimistic earnings, signs of slowing inflation, and a decline in sovereign bond yields in the euro area, with increasing bets on lowering interest rates in 2024. The index increased 3.4% during the week.
The decisions of the Federal Reserve, the Bank of England, the European Central Bank and other banks to keep monetary policy unchanged have strengthened investors’ hopes that interest rates have already reached their peak.
“There is cautious optimism that this is the end of interest rate hikes, but this narrative is premature because we need to know how the data will come out,” said Giles Coughlan, chief market analyst at GCFX Limited. Coughlan added that it all depends on the path of inflation
Real estate stocks witnessed their largest weekly gains since at least 2008, rising 12.2%, as a rise in government bonds led to a decline in yields in Europe and around the world.
The automobile sector also increased by 1.7%, achieving weekly gains of 6.2%
BMW shares rose 2%, and Volvo Cars shares jumped 3.7%
Nixi shares rose 6.1% after a report stated that the American private investment company Silverlake is considering buying the Italian digital payment company.
Caring shares increased 2.9% after Deutsche Bank raised the rating of the French luxury group
Shipping services group A.P. Moller-Maersk was the worst performer during the day, with its stock declining 16.9%.
The energy sector fell 2.2%, tracking the decline in oil prices as concerns about supplies that resulted from tensions in the Middle East eased.
The energy sector was the only European sector that ended the week with a decline
