(Reuters) – European shares were muted on Friday as investors looked to business activity data for February to gauge the pace of a broader economic rebound, while Hermes jumped after issuing an upbeat quarterly earnings report.
The pan-European index was up less than 0.1% by 0831 GMT, while shares of Hermes surged 5.8% after the Birkin bag maker said sales recovered sharply in the fourth quarter.
The stock was among the biggest gainers on the STOXX 600 and also helped lift the European personal goods index by 0.8%.
The STOXX 600 was set to end the week with modest declines, snapping a two-week gaining streak, as optimism around a better-than-expected earnings season gave way to fears that rising inflation could lead central banks to start tapering a raft of stimulus packages.
“This week’s slightly adverse price action has all the hallmarks of a loss of momentum temporarily and not a structural turn,” said Jeffrey Halley, senior market analyst at OANDA.
“There is not a major central bank in the world thinking about taking their foot off the monetary spigot, except perhaps China. (Markets) will remain awash in zero percent central bank money through all of 2021 (and) a lot of that will head to the equity market.”
Minutes of the European Central Bank’s January meeting, released on Thursday, showed policymakers expressed fresh concerns over the euro’s strength but appeared relaxed over the recent rise in government bond yields.
The STOXX 600 has rebounded more than 50% since crashing to multi-year lows in March 2020, with hopes of a global economic recovery this year sparking demand for sectors such as energy, mining, banks and industrial goods.
Mining stocks rose 0.9% and were on course for their third week of gains in a row as copper prices scaled nine-year highs.
All eyes later in the day will be on flash readings of business activity from across the euro zone after data from the United States on Thursday showed a surprise rise in weekly jobless claims.
In company news, French carmaker Renault fell 3.9% after posting a record annual loss of 8 billion euros ($9.68 billion), while food group Danone and German insurer Allianz posted small gains following upbeat trading forecasts.
Reporting by Sagarika Jaisinghani in Bengaluru; Editing by Subhranshu Sahu and Sriraj Kalluvila