[BENGALURU] European shares climbed to record highs on Wednesday (Oct 8), powered by strong gains in French and Spanish stocks, and steelmakers rallied after the EU unveiled plans to slash steel import quotas.
The pan-European Stoxx 600 was up 0.8 per cent, closing at its highest level, while French stocks jumped 1.1 per cent and Spanish stocks touched their highest mark since 2007.
Germany’s DAX closed at a near three-month high.
Banks were the biggest boost to the Stoxx 600, adding over 1 per cent. British lender Lloyds rose after the UK’s financial watchdog proposed a smaller-than-expected compensation package over motor finance mis-selling, easing investor concerns.
Societe Generale and Italy’s BPER Banca also joined the rally, fuelling broad gains across the sector.
Steelmakers surge
Steelmakers surged higher after the European Commission proposed slashing tariff-free steel import quotas by nearly half, sending shares of ArcelorMittal, Aperam, Thyssenkrupp and SSAB up between 4 per cent and 7 per cent. The broader basic resources index rose 1.9 per cent.
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
In contrast, BMW tumbled 8.2 per cent after the carmaker cut its 2025 earnings forecast due to changed US tariff assumptions and weaker-than-expected growth in the Chinese market.
Rival Mercedes fell 2.9 per cent, while the broader autos index eased 2.1 per cent.
France’s political uncertainty remained centre stage, as caretaker Prime Minister Sebastien Lecornu struck a cautiously optimistic tone, suggesting a budget deal could be reached by year-end – potentially averting a snap election.
SEE ALSO
French mid-caps rose 0.7 per cent, echoing gains in blue-chips, after markets slumped earlier this week following Lecornu’s abrupt resignation on Monday.
The French benchmark remains one of Europe’s laggards in 2025, up just 9 per cent year-to-date, trailing double-digit rallies across most major bourses.
“The general view among clients was an expectation of new legislative elections in the coming week, but little chance of France’s budget deficit returning to levels below 3 per cent GDP before 2030 and little hope of relief for the French bond market for now,” said Olivier Korber, a strategist at Societe Generale.
Technology stocks fell 0.6 per cent, with chip-related companies ASML and ASMI leading declines after US lawmakers called for broader bans on sales of chipmaking equipment to China.
On the macro front, Germany’s economy ministry nudged up its 2025 growth forecast on Wednesday, now expecting a modest 0.2 per cent expansion, up from zero, citing signs of a gradual recovery.
Among other stocks, Puma rose 6.8 per cent after BofA Global Research raised its rating on the German sportswear group to “neutral” from “underperform”.
Umicore climbed 5.5 per cent after the Belgian metal recycling group said that it plans to sell its permanent gold inventories for about 410 million euros (S$618 million).
Unite Group fell 10.7 per cent after the British student accommodation developer reported softer rental growth in the third quarter. REUTERS