Motoring Stocks Cancel Out Further Losses In European Stock Markets

European stocks opened on the bullish side today but drifted lower reflecting all the mixed sentiments from the Asian session. Asia saw most stocks tumble and it was also not rosy from Japan as weak GDP numbers had been released moments before the London session kicked into life. Aside from plummeting mining stocks, the motoring and commodity stocks had a good run this Monday and that offered some hopes for euro-region shares. US trading also begun with most stocks edging moderately higher.

The Euro Stoxx 50 is a combination of the blue chip stocks around Europe, and this index showed a proper gain of 0.004% minutes into the start of trading. The French CAC 40 also gained 0.29% before closing at -0.05%. The German DAX continued its gaining streak to open 0.15% higher. The situation also looks positive in the U.K as the FTSE basked in the glory of a booming property market. The latest stats from property survey firm ‘Rightmove’ show that the average asking price for private residential properties in the UK has dropped 1.2% with more people opting to purchase the houses under the slightly discounted market.

Japanese stocks closed last week on a lackluster position even with mild excitement from oil gains and talks of linkages between the Shenzhen exchange and the Hong Kong exchange. Weak Japanese data has not done the Asian exchanges any more justice during this week’s open. Japan’s June quarter GDP data showed more stagnation setting in in the Japanese economy, watering down the high expectations of a 0.7% expansion. The final official figures showed that there was a poorer than expected 0.2% gain. The Indian markets and the South Korean Kopi remained closed on Monday as the countries both have public holidays.

Motoring stocks trend higher

European stocks have been boosted by motoring and resource stocks that provided most of the strength. Volkswagen and Daimler were the biggest car stocks while Heidelberg Cement, Continental and Infineon also provided most of the bullish momentum in the region. Most of the bearish sentiment came from chemical, mining and financial stocks. France’s CAC 40 showed remarkable performance from Bouygues, Renault and Peugeot. Commodity stocks including Arcelor Mittal remained the laggards in the index.

The financial results season continues with companies like Bovis Homes reporting high first half profits even though the stock slumped by over 3.5%. Hennes and Mauritz has announced a 10% jump in year on year sales, a good comparison to the June figure of 8%. Positive results from major players has however not been enough to reflect in the broader European indexes but they sure achieved much in keeping the markets flat, canceling out heavy losses from other stocks.