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European shares advanced on Friday, buoyed by a tech stock rebound and positive corporate earnings. The Europe-wide STOXX 600 index climbed 0.3% by 0840 GMT, with the tech sector leading the charge after a turbulent week. The index appeared set for its second consecutive weekly gain, bolstered by the European Central Bank’s (ECB) recent rate cut and corporate optimism.
Tech Stocks Rebound After Rough Week
After experiencing a steep sell-off earlier in the week, the technology sector made a strong comeback, rising over 2%. This rally reduced the sector’s weekly losses to 4%, though it remains the worst performer this week. The downturn was initially triggered by chip equipment maker ASML’s weak 2025 sales forecast, which caused a global slump in chip stocks.
Despite the gloomy forecast, ASML shares rebounded 4.4% on Friday, while other chip stocks like Soitec SA and BE Semiconductor Industries surged over 3% each.
Basic Resources and Luxury Stocks Rise
The basic resources sector also saw gains, climbing more than 2%, helped by rising copper prices. Meanwhile, luxury stocks rallied after suffering earlier in the week due to disappointing sales from industry leader LVMH. The luxury giant’s weak third-quarter performance had triggered a selloff, but stocks bounced back as LVMH, Gucci-owner Kering, and Hermès gained between 2% and 3%.
This luxury sector recovery helped France’s CAC 40 outperform other regional indexes. Switzerland’s Richemont also enjoyed a 5% rise, while Italian luxury brand Brunello Cucinelli jumped 3.6% on the back of strong nine-month revenue results.
Policy Moves and Individual Stock Performances
On the policy front, the ECB’s decision to cut rates to 3.25% on Thursday further influenced market sentiment. While ECB President Christine Lagarde offered no definitive guidance on future actions, insiders suggested that a fourth rate cut could occur in December if key economic data fails to improve.
Among notable individual stock moves, Swedish truck maker Volvo saw a 2% rise after initially dropping due to a disappointing third-quarter operating profit and a forecast for stable demand in 2024. On the downside, British American Tobacco shares slipped 2% as the company approached a settlement in its Canadian tobacco litigation.
Several companies saw gains after receiving rating upgrades. Switzerland’s Avolta and chocolate maker Barry Callebaut rose between 2% and 3% following positive evaluations from Deutsche Bank and Morgan Stanley.
However, Finnish telecom operator Elisa faced a 6% drop after its third-quarter revenue fell short of expectations. Swedish medical equipment maker Getinge also declined 5% after a disappointing core earnings report. Additionally, Europe’s largest debt collector, Intrum, announced plans to file for U.S. bankruptcy protection, causing its shares to fall by 2.2%.
Overall, the European stock market displayed resilience as strong earnings, policy shifts, and sector recoveries helped offset earlier concerns about inflation, global demand, and corporate challenges.
