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Europe Markets: AutoStore, Kering and Commerzbank buck losses for European stocks as geopolitical headwinds swirl

Upbeat corporate news from many European companies such as Kering and Commerzbank were a bright spot for the region Thursday, but geopolitical worries were keeping a lid on the main stock index.

The Stoxx Europe 600 index
SXXP,
-0.33%

dipped 0.3% to 466.12, in a week that has seen it lose about 0.4% so far. The German DAX
DAX,
-0.51%

fell 0.5% and the FTSE 100
UKX,
-0.72%

slid 0.7% as oil prices fell. The French CAC 40
PX1,
-0.12%

was down just 0.1% thanks to gains in the luxury goods sector.

NATO on Thursday accused Russia of misleading the world over claims it had removed troops from around Ukraine, saying that instead, there had been a buildup. Investors were also rattled by reports from Russian separatists in the Luhansk region of increased Ukrainian shelling.

“The West remains convinced that an invasion remains highly likely and that flare-ups in Eastern Ukraine between Russian-backed separatists and Ukrainian forces could be used to justify crossing the border,” said Craig Erlam, senior market analyst at OANDA.

“Whether the intelligence is trustworthy or hysteria, as Russia has labeled it, will soon become clear but in the interim, efforts towards a diplomatic solution continue which will keep investors on edge,” he said.

Investors also continue to juggle worries over inflation and central bank action to combat higher prices.

Among companies reporting Thursday, shares of AutoStore
AUTO,
+9.83%

climbed 9% after the Norweigian robotics company reported blowout fourth-quarter results. “Orders were 39% ahead, revenues 20% ahead and [adjusted] EBITDA 12% ahead,” noted a team of equity analysts at Jefferies led by Lucas Ferhani.

Stock in Kering
KER,
+6.39%

surged 6% after the luxury goods group said sales and earnings last year recovered well beyond the pre-pandemic period, helped by its core brand Gucci. The company is confident over its margins looking ahead, even if prices have to go up, said finance chief Jean-Marc Duplaix in a media conference.

Commerzbank
CBK,
+3.75%

was another gainer, up 4% after the German bank swung to a forecast-beating profit in the last quarter of 2021, and laid out plans to resume dividend payments this year.

Stock in Infineon Technologies
IFX,
-1.30%

slid 1% after the company said it would invest $2.27 billion to boost its manufacturing capacity in the field of wide bandgap semiconductors.

Meanwhile, one of Europe’s most heavily weighted stocks, Nestlé
NSRGY,
+0.17%

NESN,
+0.43%
,
reported higher profit in 2021, with growth driven by momentum in retail sales, a recovery of out-of-home channels, increased pricing and market-share gains.

“We believe that the increased efforts in R&D, digital, and sustainability in past years are enhancing the relevance of the offerings at consumers — differentiated products and services, leading to strong market shares in leading categories, ” said Bertschy Jean-Philippe, analyst at Vontobel.

“The fundamentals have rarely been as strong, widening the gap to the competition, facing their own issues as seen in the past weeks. Considering the ongoing market uncertainties, we believe that Nestlé is a must have,” said the analyst.

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