LONDON – European stocks started the final session of 2023 higher, marking a positive end to a solid year.
The regional Stoxx 600 index rose 0.26% in mid-morning trading, with all sectors in the green. Trading is expected to be weak as London markets close earlier.
Spanish pharmaceutical company Grifols saw its shares rise the most, up 8.9%, after announcing that it was selling a 20% stake in Shanghai RAAS, a blood products company, to the Chinese company for around $1.8 billion company Haier will sell.
European markets
| TICKER | COMPANY | PRICE | CHANGE | %CHANGE |
|---|---|---|---|---|
| .FTSE | FTSE 100 | 7,734.54 | +11.80 | +0.15% |
| .GDAXI | DAX | 16,746.95 | +45.40 | +0.27% |
| .FCHI | CAC 40 index | 7,556.82 | +21.66 | +0.29% |
| .FTMIB | FTSE MIB | 30,451.12 | +119.95 | +0.40% |
| .CAPRICORN | IBEX 35 Idx | 10,113.50 | +27.30 | +0.27% |
The blue-chip benchmark Stoxx is expected to gain more than 12% in 2023, nearly recouping its 2022 loss, according to LSEG data.
Germany's DAX rose almost 20% despite the country's dire economic situation, while France's CAC 40 and Britain's FTSE 100 rose 16.3% and 3.64%, respectively.
In the US, the S&P 500 index is chasing a new record high to round off the rally of the last two months.
Recent data releases, including Thursday's jobless claims data, continue to suggest that U.S. economic growth is slowing without stopping. Market bets currently place a 72.8 percent chance that the Federal Reserve will begin cutting interest rates as early as March 2024, CME's FedWatch shows.
According to the latest readings of the year, headline annual inflation in the US slowed to 3.1% in November from 6.4% in January.
That compares with a fall from 8.5% to 2.4% in the euro zone and from 10.1% to 3.9% in the UK – both of which have also fueled expectations of interest rate cuts next year given the sharp slowdown in both economies .
“The apparent loss of U.S. economic momentum at the end of 2023 is consistent with the view that the full impact of the Federal Reserve's aggressive rate hikes may still be in the pipeline,” economists at Berenberg said in a note on Friday.
“Nevertheless, the Fed remains on track to achieve the normally elusive feat of a soft landing in 2024. “Weakening underlying inflation has encouraged bond and stock markets to play the Fed pivot theme,” they added, although they don’t expect that first cut until May 2024.
Spanish inflation data will be released on Friday.
According to lender Nationwide, UK house prices fell by 1.8% in the year to December, a steeper fall than recent surveys suggested but significantly lower than calls for a fall of 1.8% at the start of 2023 went out to 10%.
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