European stocks close higher on earnings; EU hits Google with record fine

  • European shares closed higher Wednesday, as investors maintained their focus on corporate earnings.
  • The European Union slapped U.S. tech giant Google with its biggest ever antitrust fine.
  • Sterling fell further against the dollar following U.K. inflation data.

European shares closed higher Wednesday, with investors maintaining their focus on corporate earnings.

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The pan-European Stoxx 600 closed provisionally 0.54 higher with almost every sector in positive territory. Technology led the gains, up by 2.53 percent, on earnings. Ericsson rose 8.52 percent after reporting second-quarter results at the higher-end of its guidance.

On Wednesday, investors monitored Brussels and Alphabet shares. U.S. tech giant Google was hit with its biggest ever antitrust fine — a $5 billion levy — after the EU ruled that its Android mobile operating system had abused the mobile software's dominance in the industry. Google said it would appeal the decision. Alphabet's stock slipped slightly following the EU announcement.

On Wall Street, stocks traded mixed following weaker-than-expected housing data; traders also continued to monitor incoming corporate results.

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Earnings

Biopharmaceutical firm Swedish Orphan Biovitrum topped the European benchmark, up 13.89 percent after reporting a quarterly increase in earnings before interest, tax and amortization of 94 percent. Tele2 B was among the best performing stocks, up by 13.43 percent, on earnings. It reported results above forecasts and raised its guidance for 2018. Meanwhile, paper and pulp maker BillerudKorsnas was off by 15.72 percent, after disappointing results.

Aside from earnings, market sentiment followed the optimism stateside. U.S. stocks jumped Tuesday following confident remarks by the Federal Reserve Chairman Jerome Powell.

During his address to Congress, Powell downplayed concerns over the economic impacts of a trade war and added that, ultimately, if the White House managed a world of lower tariffs that would be positive for the economy.

Back in Europe, Olli Rehn, the newly- appointed Finnish bank governor and European Central Bank member, said that the central bank should not tie its hands too early when it comes to what it might do in the future. In an interview to Reuters, Rehn said any monetary policy decision should depend on incoming data.

In the U.K. Prime Minister Theresa May narrowly avoided a defeat in Parliament over future trade links with the European Union, after it leaves the bloc.

UK inflation steady

Data released Wednesday showed U.K. inflation holding steady in the month of June at 2.4 percent on the year. Sterling fell further against the dollar following the data release.