(Businesshala) – European stocks rose on Wednesday after one of the worst markets this year, with investors picking up on beaten-down stocks of the technology sector, while chip equipment maker ASML benefited on upbeat earnings estimates.
The pan-European STOXX 600 index rose 1% after falling 2.2% in the previous session in its biggest percentage daily decline since mid-July.
Global stocks fell on Tuesday as US government bond yields rose on rising hopes of a faster interest rate hike by the Federal Reserve and turned investors away from high-growth technology stocks.
The European technical sector was up 1.5% on Tuesday after falling 4.8%. ASML Holding NV, one of the leading suppliers of computer chip makers, rose 1.8% after raising financial targets.
ASM International jumped nearly 6% a day after raising its third-quarter order intake guidance.
After smooth gains over the past seven months, stock markets have faced volatility in September as investors panicked at major central banks rolling back pandemic-era stimulus amid signs of higher inflation.
The benchmark STOXX 600 is certainly down about 3% at the end of September, leading to modest gains in the quarter.
“Rates are still low in historical terms, but if the economy is caught short of time to adapt to tighter credit conditions, sharp sustained growth will upset markets,” said Jim Smigiel, SEI’s chief investment officer.
The recent surge in commodity prices, supply-chain crunch, Evergrande debt crisis and power crunch in China have hurt global growth sentiment.
Data showed Spain’s inflation hit a 13-year high in September. The monthly reading for euro area consumer confidence is 0900 GMT.
Among other individual stocks, British drugmaker AstraZeneca gained 2.3% after saying it would take full control of Calum Biosciences in a deal worth up to $500 million.
British clothing retailer Next climbed 2.5% to a record high after raising its full-year profit outlook for the fourth time in six months.
Meanwhile, the oil and gas index slipped back from a one-year high as the recent rally in crude oil prices eased following an unexpected build-up in US inventories. [O/R]
Royal Mail plc fell 4.9% to a UK FTSE 100 low after UBS downgraded the stock from “buy” to “sell”.