European stocks index post a third month of gains supported by strong earnings and recovery hopes

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© Reuters. European stocks index post a third month of gains supported by strong earnings and recovery hopes

(Reuters) – The European stock market closed lower on Friday after pessimistic GDP data, but recorded a third straight month of gains supported by strong corporate earnings and optimism for an economic recovery from the Covid-19 pandemic.

The pan-European STOXX 600 index ended the trading session down 0.3%, but remained close to its all-time high and ended the month 1.8% higher.

Data showed that the region’s economy fell to its second technical recession after a smaller-than-expected contraction in the first quarter. However, it is heading towards recovery with the lifting of pandemic restrictions amid the acceleration of vaccine distribution.

The German economy recorded a larger-than-expected contraction of 1.7 percent, affected by renewed closures, while the French economy recorded greater growth than expected.

But strong profits showed that companies in the euro zone are on a fast pace to recover from the repercussions of the pandemic.

Banking stocks came under pressure on Friday, to close their index down 0.76% as euro zone bond yields fell from their highest level since January 2020.

British bank Barclays (LON 🙂 fell 7 percent despite more than doubling its quarterly profit, while French bank BNP Paribas fell 0.8 percent due to rising costs.

Among the gainers in Friday’s session, Astra (SE 🙂 Zenica jumped 4.3 percent, with the British pharmaceutical maker reporting better-than-expected results.

(Wajdi al-Alfi prepared for the Arabic newsletter)

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