European markets close higher as investors react to Fed minutes; Rolls-Royce up 23%

This is CNBC's live blog covering European markets.

European markets closed slightly higher Thursday as investors digested minutes released by the U.S. Federal Reserve that showed members are still committed to fighting inflation with interest rate hikes.

The pan-European Stoxx 600 index closed 0.1% higher, with oil and gas stocks adding 1.1% and tech shaking off recent pessimism to gain 0.4%. Mining stocks led losses, dropping 1.6%.

European markets

Shares of British engine-maker Rolls-Royce rose sharply after the company beat analyst expectations with a reported 57% year-on-year profit increase last year. It also said it would resume dividend payments at an unspecified date.

Results also came in from European firms including Solvay, Accor, Heidelberg Materials, BAE Systems, Munich Re and Heathrow Airport.

The Fed minutes stated U.S. inflation "remained well above" the central bank's 2% target and the labor market "remained very tight, contributing to continuing upward pressures on wages and prices."

Asia-Pacific markets closed mixed on Thursday after the Fed release, while U.S. stocks rose Thursday, with chipmaker Nvidia leading tech gains.

Analyst sees move away from investment in Chinese tech and security

There will be a strong decoupling from China in tech and security, according to the CEO of Berlin Global Advisor Jan Kallmorgen, who doesn't advise investing in the country.

Analyst sees move away from investment in Chinese tech, security
Analyst sees move away from investment in Chinese tech, security

— Hannah Ward-Glenton

U.S. stocks rise

U.S. stocks rose Thursday, with chipmaker Nvidia leading tech gains, while traders assess future potential Federal Reserve moves.

The Dow Jones Industrial Average added 112 points, or 0.3%. The S&P 500 gained 0.8%, and the Nasdaq-Composite jumped 1.1%.

The Nasdaq got a boost from Nvidia, which rose more than 8% on better-than-expected fourth quarter earnings and revenue.

The S&P 500 is coming off its fourth straight losing session, dropping 0.2% on Wednesday. The Dow also fell, while the Nasdaq Composite posted a small gain.

Spain is making a ‘very strong’ economic recovery, minister says

Spain is making a 'very strong' economic recovery, minister says
Spain is making a 'very strong' economic recovery, minister says

Nadia Calvino, Spain's economy minister, says the outlook for the country is "relatively positive."

Hotel group Accor says domestic travel is above pre-pandemic levels

French hospitality group Accor ticked slightly higher as its full-year results showed its operating profit grew from 53 million euros ($56 million) to 543 million euros.

The rebound was driven by domestic guests, it said, while hotel performance in the second half of the year exceeded 2019 levels in all regions but Asia, where China restrictions weighed.

"We are at a momentous milestone," Jean-Jacques Morin, Accor deputy CEO and CFO, told CNBC.

"If you just step back and put yourself one year at the same time we were all talking about omicron, so I think nobody was forecasting such resiliency and capability to rebound."

People were keen to get back to travel when restrictions eased last year, he said, but momentum continued as they proved willing to keep spending despite rising cost pressures.

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Accor share price.

— Jenni Reid

Solvay CFO: We expect to maintain profitability, but we can’t defy gravity

Solvay CFO: We expect to maintain profitability, but we can't defy gravity
Solvay CFO: We expect to maintain profitability, but we can't defy gravity

Solvay's chief financial officer Karim Hajjar says "what we can do is expect to navigate that."

Heathrow Airport losses narrow in 2022

The biggest airport in Europe by passenger numbers, London's Heathrow, is not expecting to come into profit this financial year.
Anadolu Agency / Contributor / Getty Images

Britain's largest airport, Heathrow said annual losses nearly halved, but flagged ongoing pressure from low passenger traffic and inflation.  

The company said adjusted annual losses slimmed to £684 million ($824 million) in 2022, down 46% from the £1.27 billion of 2021. Passenger numbers trebled year-on-year to reach 61.6 million in 2022 — in line with the company's projection of 60-62 million passengers, but roughly 25% below 2019, as international travel recovers from its plunge during the Covid-19 pandemic.

Noting its financing remains conservative, Heathrow Airport said no dividends were paid in 2022, and that none are planned for 2023. The airport is owned by the FGP Topco consortium, with Spanish group Ferrovial and the Qatar Investment Authority as the largest stakeholders.

- Ruxandra Iordache

Rolls-Royce beats expectations with 57% profit hike in 2022

British aviation manufacturer Rolls-Royce sharply beat expectations with a 57% year-on-year increase in underlying profit, driven by its civil aerospace and power systems.

The company recorded £652 million ($786 million) of underlying profit last year, £238 million higher than in 2021 — exceeding analyst forecasts near £478 million, as polled by Reuters. Rolls-Royce's free cash flow from continuing operations added £2 billion on the year to £505 million in 2022.

The company attributed the results to recovering demand for international travel, noting a 35% year-on-year hike in large engine flying hours for civil aerospace. The aviation sector is recovering from the severe pressure suffered during the Covid-19 pandemic, when lockdowns and higher barriers to passenger entry choked international mobility.

Rolls-Royce said it will make no shareholder payments for the 2022 financial year, but pledged to return to an investment grade credit rating and resume the practice, without specifying a timeline.

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Rolls-Royce share price.

The company is undergoing a transformation program to improve its performance in 2023, led by Tufan Erginbilgic — the former BP executive who succeeded Warren East in January. The program will include a strategic review, with Rolls-Royce set to announce its ensuing medium-term goals in the second half of this year.

The company projects "a continued recovery in our end markets" and further increases to returns in 2023, issuing operating profit guidance between £0.8 billion and £1 billion and a fresh cash flow outlook of £0.6 to £0.8 billion.

Rolls-Royce shares were up 15.87% at 8:24 a.m. London time, following the results announcement.

- Ruxandra Iordache

Stocks on the move: Rolls-Royce up 18%, Mondi down 6.5%

Shares of Rolls-Royce popped 18% in early trade as the engine-maker reported full-year results. The company smashed through expectations with a 57% rise in underlying operating profit.

Genus, a British firm which breeds genetically desirable livestock for farmers, was another strong performer, up 8.7% on its 18% profit rise in half-year results.

At the bottom of European stocks was packaging and paper company Mondi, down 6.7%. The company reported a 119% profit increase but warned of an "environment of softer demand and pricing."

— Jenni Reid

European markets open higher

Europe's Stoxx 600 was cautiously higher at the open, up 0.1%, with tech stocks leading gains.

The index posted losses in the previous two sessions.

Investors will be assessing yesterday's Fed minutes, amid fears the U.S. central bank will continue hiking rates weighing on markets, as well as a slew of earnings from companies including Rolls-Royce, Anglo American and BAE Systems to gauge the outlook for various sectors.

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Stoxx 600.

— Jenni Reid

CNBC Pro: There is a 'rare' opportunity to invest in a global VC stock set for 130% upside, analysts say

Global shares of a venture capitalist company are expected to soar by 130% over the next 12 months, according to an investment bank.

The investment bank is not alone in its bullish view. Even the most conservative analysts have a price target pointing toward a 90% upside.

CNBC Pro subscribers can read more here.

— Ganesh Rao

CNBC Pro: Analyst says it's the 'last phase' of the bear market — and names 3 stocks to buy right now

Markets rallied at the start of the year. But on Tuesday, the main Wall Street indexes closed to cap their worst day of 2023.

James Demmert, chief investment officer at Main Street Research, says this is the "last phase" of the bear market and predicts when it will end.

He names three stocks to buy right now.

CNBC Pro subscribers can read more here.

— Weizhen Tan

European markets: Here are the opening calls

European markets are expected to open mixed Thursday.

The U.K.'s FTSE 100 index is expected to open 7 points higher at 7,624, Germany's DAX 33 points lower at 15,929, France's CAC 14 points lower at 7,194 and Italy's FTSE MIB 22 points lower at 27,025, according to data from IG.

Data releases Thursday include euro zone unemployment figures for the first quarter and revised gross domestic product data for the same period. There are no major earnings releases today.

— Holly Ellyatt