The Apple effect.
Reassuring numbers from the iPhone and iPad maker are helping tech stocks from Hong Kong to Amsterdam, offsetting pressure from resource stocks on equities indices.
Some of the best individual gains in Europe are being made by Apple’s suppliers. Shares in Dialog Semiconductors are up 5.6 per cent, and ST Micro is up 1.7 per cent.
The Euro Stoxx technology index is 0.4 per cent higher overall, while the wider Euro Stoxx 600 is flat. The Dow Jones Industrial Average is expected to open above the 22,000 mark for the first time when New York trade starts, with Apple set to help the 30-member benchmark over the line.
Ian Williams at Peel Hunt says:
The second quarter reporting season continues to impress, with an S&P earnings per share beat rate of 72 per cent, and the Apple numbers after the close extended that trend.
[The] solid start to August for most European equity markets reflected another set of encouraging economic activity data, and some broadly supportive bottom-up corporate trading updates. Although euro strength is posing an increased potential headwind to future earnings growth, the out-turn so far from this reporting season has been supportive, with an EPS beat rate of around 60 per cent.
Hong Kong‘s Hang Seng is up 0.3 per cent, with tech stocks in demand, helping it extend its year-to-date rally to over 25 per cent. South Korea’s Kospi is up 0.2 per cent.
The Xetra Dax 30 in Frankfurt is up 0.1 per cent, but London’s FTSE 100 is down 0.1 per cent as resource stocks are taking a toll on the UK index, in line with weaker commodity markets. Rio Tinto is among the biggest London fallers, down 1.8 per cent, even after it announced a record interim dividend. Australia’s mining-heavy S&P/ASX 200 is out of the wider rally. It is down 0.5 per cent.
Oil is dropping further as concerns mount about persistent oversupply make the $52-mark for Brent crude look uneasy. The global oil benchmark is trading down 0.7 per cent $51.43 a barrel. West Texas Intermediate, the US marker, is down 0.8 per cent at $48.79.
The dollar continues to wilt, in part due to unease at the outlook for continued policy gridlock in Washington, and the resultant lack of fiscal stimulus or tax reform from the Trump administration.
The index tracking the greenback is down 0.1 per cent at 92.968, around its lowest level since May 2016. The euro is up 0.3 per cent at $1.1833, with the pound up 0.1 per cent at $1.3218.
The yen is hovering just below ¥110.8, down 0.3 per cent on the session, after firming briefly to the ¥110 level on Wednesday.