UPDATE 2-Solid earnings boost European stocks as ECB stands pat

  • Reuters
  • Stock Market News
UPDATE 2-Solid earnings boost European stocks as ECB stands pat
Credit: © Reuters.

* Nestle (NS: NEST ) boosts STOXX 600 after strong Q1

* Pernod Ricard lifts luxury sector

* ECB stands pat on interest rate

* Credit Suisse slips as Archegos unwind hits Q1 (Updates to close)

By Sruthi Shankar and Susan Mathew

April 22 (Reuters) - European stocks moved towards record highs on Thursday, following a set of strong company earnings and as the European Central Bank left policy unchanged as expected.

Heavyweight Nestle NESN.S rose almost 3% after reporting its strongest quarterly sales growth in 10 years, while software group SAP SAPG.DE and French spirits group Pernod Ricard PERP.PA were among some of the other stocks to surge after results. Suisse CSGN.S , meanwhile, fell 2.1% after a hit from the collapse of U.S. investment fund Archegos wiped out what would have been a stellar trading period, leaving it with a slightly smaller-than-flagged quarterly pre-tax loss of 757 million Swiss francs. pan-European STOXX 600 index .STOXX rose 0.7%, extending gains for a second day, after fears of a new wave of COVID-19 cases pushed European markets to their worst day in 2021 on Tuesday.

While global investors remain nervous about a resurgent coronavirus crisis in Asia and stretched valuations in parts of U.S. equities, European stocks have enjoyed strong gains this year as COVID-19 vaccination drive and stimulus programmes lift hopes of a strong economic rebound.

The ECB's decision to keep rates unchanged as widely expected sets the stage for a battle at the June 10 meeting, when policymakers have to decide whether to slow bond buying, even if that means allowing borrowing costs to drift higher. the more optimistic projections for the vaccination rollout really materialise... the next batch of staff projections (in June) could show an upward revision to the growth forecasts and a confirmation of the economic recovery in the second half of the year," said Carsten Brzeski, global head of macro at ING.

Shares of renewable energy companies such as Vestas VWS.CO and Siemens (NS: SIEM ) Gamesa SGREN.MC surged, with Vestas jumping 10% for its best day in a month, after the Biden administration on Thursday pledged at a U.S. climate summit to slash U.S. greenhouse gas emissions in half by 2030. bag maker Hermes HRMS.PA was up 2.1% as strong growth in Asia powered a 44% surge in quarterly sales. companies are set to exit a two-year profit slump with a record jump that outperforms U.S. peers, with profits for companies on the STOXX 600 forecast to have risen 61% in the first quarter, as per Refinitiv IBES data. other decliners, Britain's biggest defence contractor BAE Systems BAES.L lost 5% as it faced mounting criticism for handing its chief executive an extra 2 million pounds ($2.8 million) to convince him to stay.

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