Europe Markets

European stocks close higher on strong earnings; SAP down 2.5%

Key Points
  • The pan-European Stoxx 600 provisionally closed up by 1.7%, with travel and leisure stocks adding 3.7% to lead gains.
  • Markets in Europe are extending gains from the previous session, following a sharp sell-off on Monday.
  • Daimler, SAP and Novartis were among the European companies reporting earnings Wednesday.

European stocks closed higher Wednesday, as investors tracked another batch of quarterly earnings and shrugged off Covid-19 fears.

The pan-European Stoxx 600 provisionally closed up by 1.7%, with travel and leisure stocks adding 3.7% to lead gains as all sectors and major bourses entered positive territory.

Markets in Europe extended gains from the previous session, following a sharp sell-off on Monday as traders worried the fast-spreading Covid delta variant could impact the global economic recovery.

Shares in the U.S. and Asia also advanced on Wednesday. On Wall Street, U.S. equities continued to rise on the back of better-than-expected earnings reports from Coca-Cola and Johnson & Johnson.

Asian stock markets closed mostly higher after new figures showed Japan's exports rising 48.6% in June as compared with a year earlier, higher than a 46.2% increase expected by economists in a Reuters poll.

Earnings in focus

In Europe on Wednesday, earnings came from Daimler, SAP, Julius Baer and Novartis, while Royal Mail released a trading update.

SAP shares fell 2.5% by the close despite raising its outlook for the second time this year, as a strategic push toward cloud computing began to bear fruit.

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See strong pipeline for new cloud customers ahead, SAP CFO says

At the bottom of the Stoxx 600, Dutch chemicals company Corbion fell 8.4% after Barclays cut the stock to "underweight."

At the top of the index, Swedish outdoor and transportation equipment manufacturer Thule Group surged 12.2% after a strong second-quarter earnings report.

British fashion retailer Next jumped 7.5% after smashing second-quarter sales forecasts and British media company Future climbed 9.2% after raising its full-year guidance.

Daimler kept its profit margin outlook unchanged but warned that the global semiconductor shortage will continue to dent car sales into 2022. The German carmaker's stock climbed slightly.

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- CNBC's Ryan Browne, Maggie Fitzgerald and Eustance Huang contributed to this market report.