By Johann M Cherian and Sukriti Gupta
(Reuters) -European stocks nudged higher on Monday as investors digested a new round of earnings reports, while auto shares gained on optimism that Dutch chipmaker Nexperia’s China plants will resume shipments.
The pan-European STOXX 600 crept up 0.1% to 572.28 points.
Other major regional indexes were mixed, with Germany’s DAX up 0.7% and France’s CAC 40 down 0.1%.
Auto stocks advanced with Renault, Mercedes Benz <MBGn.DE> and Volkswagen gaining between 1.9% and 2.3%after a source said that the White House would soon announce a resumption of Nexperia shipments from China.
Against this backdrop, the broader auto sector had logged its second straight month of declines in October.
“After what it seems to have been an unrelenting string of bad news from European carmakers, this gives them a bit of a shot in the arm.
It’s not a turnaround, but it’s certainly a bit more support that we’re looking for,” said Chris Beauchamp, chief market analyst at IG Markets.
The Dutch government recently seized control of Nexperia, owned by Chinese company Wingtech, which prompted Beijing to block Nexperia products from leaving China, creating supply disruptions for automakers globally.
European tech stocks rose 0.6%.
Travel and leisure stocks advanced 1.7%, boosted by Ryanair’s shares.
Mining stocks declined 1.5% with Anglo American and Rio Tinto down over 2% each.
Among corporate updates, shares in Siemens Energy hit a record high and were last up 2.5% after Morgan Stanley raised its target price over an improved mid-term outlook.
GTT shares touched a record high too and were last up 8.7% after the French LNG containment system specialist raised its annual revenue and core earnings forecast.
Ryanair <RYA.I> raised the prospect of more than recovering last year’s 7% fare decline.
Shares of the low-cost airline rose 3.9%.
Campari slid 2.4% after Italian tax police seized shares worth 1.29 billion euros ($1.5 billion) from a Luxembourg-based holding company that controls the Italian drinks group, citing alleged tax evasion.
“Companies in Europe that are exposed to the export markets are doing better than expected this earnings season,” said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank.
“That’s giving a boost, especially when you’re looking at the German markets, and comes as a relief for European investors.”
European stocks sustained declines late last week as hawkish comments from the U.S.
Federal Reserve and a lack of signs of a dovish move by the European Central Bank disappointed investors.
However, optimism on the global trade front following a thaw in Sino-U.S. trade tensions helped the STOXX 600 log its fourth straight month of gains in October.
On the data front, euro zone manufacturing activity stagnated in October.
(Reporting by Johann M Cherian and Sukriti Gupta in Bengaluru; editing by Sherry Jacob-Phillips, Nivedita Bhattacharjee and Mark Heinrich)
