By Nikhil Sharma
(Reuters) – European shares hit a record high on Thursday, buoyed by a raft of upbeat earnings, while Britain’s FTSE 100 also scaled an all-time peak ahead of a likely rate cut by the Bank of England (BoE).
The pan-European STOXX 600 index was up 0.7% as of 0930 GMT. The benchmark index last hit a lifetime high on January 31.
The heavyweight healthcare sub-index rose 0.8%, lifted by a 3.2% jump in drugmaker AstraZeneca. It forecast 2025 sales above analysts’ expectations after fourth-quarter revenue beat estimates.
The earnings also boosted the benchmark FTSE 100 index , which was up 1.1%.
Basic resources was the top sectoral winner on the STOXX 600, adding 2.4% after Swedish miner Boliden advanced 8% on a bigger-than-expected rise in fourth-quarter core earnings.
The sub-index got an additional lift after Aurubis, Europe’s largest copper producer, reported first-quarter pretax profit above market expectations. Its shares rose 3.4%.
Societe Generale soared 9% after the lender’s fourth-quarter profit more than doubled, helping it announce shareholder payouts at the upper end of expectations.
This boosted banks by 1.2%.
Meanwhile, all eyes are on the BoE’s policy outcome later in the day, which is expected to bring its key rate down to 4.5% from 4.75% in a bid to boost Britain’s sluggish economy amid still-high inflation.
This will be the central bank’s third rate cut since the start of the COVID-19 pandemic in 2020, trailing its peer, the European Central Bank (ECB), which has already cut five times since June 2024.
After delivering a quarter-point cut last week, the ECB indicated a further reduction in March.
“Markets are rallying in general on the back of supportive monetary conditions that are coming out with the ECB cut…so, you’ve got strong earnings supported by accommodative monetary policy,” said Patrick Armstrong, chief investment officer at Plurimi Wealth.
European equities have outperformed their Wall Street peers in the first six weeks of 2025 as investors continue to seize much lower valuations from the region in light of a more stimulative policy outlook.
However, ECB board member Piero Cipollone warned that the U.S. administration’s trade war with China could have a detrimental impact on the 20-member euro zone.
The U.S. imposed a 10% tariff on all Chinese imports this week, prompting retaliatory measures from Beijing.
Among other stocks, Danish shipping giant Maersk rose 10.2% after it reported fourth-quarter profit above forecasts.
French semiconductor materials supplier Soitec sank 30% to a near five-year low after it cut its sales forecast for 2025.
(This story has been corrected to say STOXX 600 was up 0.7%, not 1.1%, as of 0930 GMT, in the last bullet)
(Reporting by Nikhil Sharma in Bengaluru; Editing by Mrigank Dhaniwala and Sonia Cheema)
