Results boost European shares, Indivior plunge puts pressure on UK mid caps
Reuters
Published Sep 01, 2017 04:57AM ET
Results boost European shares, Indivior plunge puts pressure on UK mid caps
By Kit Rees
LONDON (Reuters) - European shares started September on a firm footing on Friday after three months of losses as financials rose and an update from Vivendi boosted media stocks.
A record plunge in pharma firm Indivior weighed on British mid caps, however.
The pan-European STOXX 600 (STOXX) index was up 0.4 percent and euro zone blue chips (STOXX50E) gained 0.6 percent, with investors poised for the U.S. monthly jobs report later in the session which could provide clues on the Federal Reserve's next decision on interest rates.
Germany' DAX (GDAXI) gained 0.5 percent and Britain's FTSE 100 (FTSE) rose 0.2 percent, though a near-40 percent slump in Indivior's (L:INDV) shares put pressure on the FTSE 250 (FTMC) which retreated 0.2 percent.
"There has been some stock-specific volatility, but overall I think the markets are still relatively well-supported by the low interest rate environment, so that's probably going to be the case for the foreseeable future," Laith Khalaf, senior analyst at Hargreaves Lansdown (LON:HRGV), said.
"While there is some ... negative sentiment towards markets, I think investors haven't really got anywhere else to go because bonds are yielding very little and cash is yielding very little," Khalaf added.
Indivior's shares were set for their biggest one-day loss on record after the firm said it would appeal against a U.S. court ruling that generic drug maker Dr Reddy's (NS:REDY) had not infringed its patents, potentially opening the way to a rival to the firm's Suboxone Film opiod addiction treatment.
On an otherwise relatively quiet day for corporate news, shares in Swedish vehicle maker Volvo (ST:VOLVb) jumped 7.2 percent and were on track for their biggest one-day gain in more than four months after setting new financial targets.
Results drove some sizeable moves, with shares in French media firm Vivendi (PA:VIV) rising around 5 percent after the group confirmed its outlook, reporting better than expected profit growth for the year. Europe's media sector (SXMP) was the top-gaining sector, up 1 percent.
"These results mean that investors are likely to believe management’s claim of a Canal+ turnaround and listen to music bulls even more," analysts at Barclays (LON:BARC) said, upping their rating on the stock to "equal weight" from "underweight".
French telecoms stock Iliad (PA:ILD) edged 1.1 percent higher on the back of robust first half earnings, which saw profit rise 22 percent thanks to winning new subscribers.
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Swiss security firm Dormakaba (S:DOKA) was another top riser, boosted 4.3 percent to an all-time high after Societe Generale (PA:SOGN) began its coverage of the stock with a "buy" rating.
Written By: Reuters
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