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The
pan-European STOXX 600 index firmed 2%, erasing its 1.7% plunge
on Thursday, and was set to clock its first weekly gain in four,
since Russia's invasion of Ukraine.
Putin said on Friday there had been some progress and "positive
shifts" in Moscow's talks with Ukraine, immediately lifting
investor sentiment.
The German DAX surged 3%, while Spain's IBEX and France's CAC 40
were up about 2.3% each.
"Although our base case remains for a ceasefire and a reduction
in hostile rhetoric between Russia and NATO by the summer, this
outcome looks some way off ... the war is adding a lack of
clarity over commodity prices, global growth and inflation,"
said Mark Haefele, chief investment officer at UBS Global Wealth
Management.
The European Central Bank on Thursday paved the way for an
interest rate hike as soaring inflation outweighed concerns
about the fallout from Russia's invasion of Ukraine, while U.S.
data showed consumer prices surged in February to a 7.9% annual
growth rate, the hottest reading in 40 years.
"Central banks now have less flexibility to cushion shocks to
equity markets, as they have succeeded in doing over recent
years," Haefele added.
Investors stampeded out of European equities at their fastest
pace on record, the Bank of America showed in a weekly report,
with investors pulling out $13.5 billion from European stocks as
the war forced investors to seek shelter in safe-haven assets
such as gold and cash.
Goldman Sachs downgraded its 2022 euro area growth forecast on
Thursday to 2.5% from 3.9%, citing risks of further escalation
in the Russia-Ukraine crisis.
Oil stocks gained 0.6% and were headed for their best week in
more than a year as crude prices saw volatile swings on a supply
shock from the Ukraine war and renewed efforts to bring more
supply to the market. [O/R]
Tod's gained 6.1% as the Italian fashion group expressed
optimism for 2022 despite global uncertainty, while shares of
infrastructure group Atlantia gained 1.1% after the company
flagged expectations of core profit rising 27% by 2024..
EssilorLuxottica added 5.8% after the luxury eyewear group
reported its best quarter of 2021 with all regions exceeding
pre-pandemic sales.
German speciality chemicals maker Lanxess strengthened 5.6%
after the company issued quarterly profit outlook above
expectations.
(Reporting by Anisha Sircar in Bengaluru; Editing by Uttaresh.V,
Sherry Jacob-Phillips and Shinjini Ganguli)
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