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European shares climb as global stock markets hover near record highs

2 months ago 364

A TV presenter gets ready for the daily reporting from the floor of the German share price index DAX at the stock exchange in Frankfurt, Germany, November 15, 2023. 

Staff | Reuters

LONDON — European markets were higher on Wednesday to kick off the final trading week of 2023, as major indexes around the world hovered near record highs.

The pan-European Stoxx 600 index was last 0.13% higher at 4:01 p.m. London time. Energy and technology were the leading sectors, gaining around 0.7% and 0.6% respectively.

The European blue chip index traded around the 478.2 mark, not far below the index's record closing high of 483.44 notched in November 2021.

Stock markets in Europe were closed on Monday and Tuesday in observance of Christmas Day and Boxing Day.

Stateside, the S&P 500 is also seeking an all-time high after another winning day on Wall Street on Tuesday. U.S. stock futures were mostly flat in early premarket trade on Wednesday.

Shares in Asia-Pacific advanced overnight, with Chinese and Hong Kong indexes bouncing on the back of a strong showing for video game stocks. Australia's S&P/ASX 200 hit its highest level since April 2022.

Trading volumes are expected to be thin during the last three days of the trading year, with fewer data points on the economic calendar and all major central bank meetings out of the way.

Federal Reserve interest rate cuts may not come until second quarter of 2024, ABP Invest CIO says

Fed won't rush to cut rates by March, investor says

The Federal Reserve could wait to cut interest rates until the second quarter of 2024, Thanos Papasavvas, ABP Invest founder and CIO, told CNBC's "Squawk Box Europe" on Wednesday.

"We don't think that they will rush to cut rates by March, we think it's most likely to happen in May," he said, adding that policymakers may wait to see how economic data points such as the unemployment rate develop.

Rates may also be cut by less than markets are currently expecting next year, Papasavvas said.

"We don't see 150 basis points of rate cuts in twelve months time," he noted.

— Sophie Kiderlin

Investors 'can be a little more optimistic' about outlook for coming months, analyst says

Investors 'can be a little more optimistic' about the Fed's intentions, analyst says

Investors can be more optimistic about the outlook for next year and the Federal Reserve's monetary policy expectations, Shelby McFaddin, investment analyst at Motley Fool Asset Management, told CNBC's "Squawk Box Europe" on Wednesday.

"We've got a bit more confirmation on the strength of consumer activity and health of the consumer through the end of December that's given, I think, investors a little bit more confidence that they can go ahead and just be a little bit more optimistic through the end of the year and about the Fed's intentions," she said.

However, companies looking for equity investments will still be in "a slightly tougher environment," McFaddin said. This is due to interest rates still being higher even when the Fed begins to cut them, and other factors such as the long-term impact of strikes, she explained.

— Sophie Kiderlin

European shares gain momentum

The pan-European Stoxx 600 index climbed 0.4% around 40 minutes into the session, after an uncertain open. Oil and gas stocks added 1% to lead gains as most sectors and major bourses entered positive territory.

The European blue chip index traded around the 479.5 mark, not far below the index's record closing high of 483.44 notched in November 2021.

Biggest movers: Vestas up 6%, Maersk down 4%

Vestas shares climbed more than 6% in early trade after the Danish wind turbine maker won a substantial new order in Australia, set to be delivered in the fourth quarter of 2024.

The momentum spread to other wind firms, with Siemens Energy up 4.8%.

Near the bottom of the Stoxx 600, shares of Danish shipping giant Maersk fell 4%.

- Elliot Smith

A flat open in Europe

The pan-European Stoxx 600 index was little changed in early trade. Tech stocks added 0.6% to lead gains while insurance shares fell 0.4%.

The European blue chip index remained around the 477.6 mark, up 12.41% on the year and not far below the index's record closing high of 483.44 notched in November 2021.

- Elliot Smith

Here are the opening calls

Britain's FTSE 100 is seen around 40 points higher at 7,748, Germany's DAX is set to climb around 70 points to 16,776 and France's CAC 40 is expected to add roughly 40 points to 7,609, according to IG data.

CNBC Pro: AI, wearables and more — these markets are booming as the world ages. The pros share 4 stock picks

The world is aging rapidly, and there are more and more ways to invest in this theme.

CNBC Pro asks expert investors in the area what the emerging trends are and the stocks to buy.

Subscribers can read more here.

— Weizhen Tan

CNBC Pro: These 8 stocks rally with a 100% hit rate when a ‘golden cross’ chart pattern forms

Eight stocks have rallied every single time after a chart pattern known as a "golden cross" has occurred, according to CNBC Pro's analysis.

The golden cross pattern occurs when a stock's short-term 50-day moving average goes above its long-term 200-day moving average on a chart. Wall Street often sees this as a bullish signal and an indicator of strong upward momentum that often precedes sustained gains.

The technical analysis of these stocks found that share prices rallied 100% of the time by 15% on average in the 30 days after forming the pattern.

CNBC Pro subscribers can read more here.

— Ganesh Rao

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