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Upbeat macro data, earnings fuel Europe stock rally

Source : REUTERS
Last Updated: Thu, Aug 01, 2013 15:40 hrs

PARIS, Aug 1 (Reuters) - European shares climbed on Thursday, with a blue-chip benchmark surging to a two-month high following a batch of forecast-beating corporate results and upbeat manufacturing data from around the world.

Shares in Societe Generale jumped 11 percent after the French lender posted earnings that more than doubled, thanks in part to a surge in securities trading revenue.

The euro zone's blue-chip Euro STOXX 50 index provisionally closed 1.3 percent higher at 2,803.10 points, a level not seen since late May and less than 2 percent below the index's year high.

Germany's DAX - home of some of Europe's biggest exporters - outperformed, up 1.5 percent, boosted by data showing China's official PMI for manufacturing surprisingly rose to 50.3 in July, suggesting a pick-up in activity.

U.S. data, meanwhile, showed output there growing at its fastest pace in two years, which pushed the S&P 500 above the 1,700 level for the first time; while European factories snapped a two-year run of declining output, a sign that the euro zone recession may be near its end.

"Good macro, good earnings, M&A revival... all the lights are turning 'green' for European equities," said David Thebault, head of quantitative sales trading, at Global Equities.

"People have been reluctant to buy shares ahead of the earnings season, that's why we're seeing massive gains in many stocks after the companies beat forecasts," he said.



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