Europe is up, but analysts warn of a “short-term downturn”. Lufthansa flies 6%
Europe started the session mostly in the green, while investors assess the European reporting season, and the market is eyeing London, where the Bank of England will announce a possible increase in interest rates by 50 basis points, the highest level since 1995. .
The Stoxx 600 added 0.36% to 439.85 points. Of the 20 sectors included in the index, retail, travel and leisure lead the growth, according to Lufthansa forecasts, while mining and personal care bear losses. The typical European benchmark is struggling to maintain momentum, ending July with the biggest monthly gain since November 2020.
In a major market move, Lufthansa shares added 6.67% after the airline predicted profits would continue to rise in the coming months, while Booking’s earnings confirm a strong start to the summer season.
On the other hand, Rolls Royce fell 5.1% after the car brand reported a first-half loss of £1.61bn (€1.92bn at current exchange rates) compared to a profit of £394m. pounds (470.79 million euros). last year.
Elsewhere in Europe, Madrid and Frankfurt added 0.84% each, Paris added 0.51% and Milan added 0.61%. Here Lisbon rises by 0.49%. Amsterdam is the only major market trading in the red (-0.22), while London is trading in positive territory in anticipation of the decision of the Bank of England.
“Despite this rise, the short-term outlook remains very negative due to continued risks of war in Ukraine and elections in Italy,” warned Elliot Hentov, head of research at Street Global Advisor, in statements to Bloomberg. .
Bernstein even states in a “research” note cited by Bloomberg that Europe is likely to enter a “mild recession” with euro weakness, an energy crisis and political uncertainty in Italy as the main challenges, “a short ‘market downturn’ is to be expected. .
