European stocks struggled for direction on Wednesday as investors reacted to results from some of the region’s biggest companies, with shares of Nestlé a top gainer, while ASML Holding, Akzo Nobel and Antofagasta all fell.
Struggling for direction, the Stoxx Europe 600 index
SXXP,
was flat at 468.91, after a 0.3% gain on Tuesday. The German DAX
DAX,
rose 0.1%, while the French CAC
PX1,
and FTSE 100
UKX,
were unchanged.
Global concerns on rising inflation were in focus, with Germany reporting a 14.2% surge in annual producer prices for September, the highest annual gain since October 1974, said statistics office Destatis.
Among companies, Nestlé
NSRGY,
NESN,
,
was a leading gainer with a rise of over 3% as the Swiss food and drink conglomerate reported higher sales for the first nine months of the year that also beat forecasts. And Nestlé lifted its full-year guidance for organic sales growth. Its Nescafe, Nespresso and Starbucks brands. Purina PetCare and vegetarian and plant-based food all drove growth.
“Nestlé appears well-positioned to weather the current environment
of rising input costs,” said a team of analysts at Morgan Stanley led by Pinar Ergun in a note to clients. The company’s valuation of 22 times 2022 earnings, excluding its L’Oréal holding, “looks undemanding to us,” said the analyst.
Another gainer was Deliveroo
ROO,
,
with shares of the delivery service also rising above 3% after reporting a rise in third quarter orders and gross transaction value and lifting guidance on the latter for the year.
On the downside, shares of ASML Holding
ASML,
ASML,
slipped over 1% even after the Dutch chip equipment maker reported a 64% gain in third-quarter net profit that beat forecasts. Amid a continuing industry chip shortage, ASML said it would need to boost capacity to meet demand for memory and logic modes.
Akzo Nobel
AKZA,
shares fell over 1% after the Dutch paints and coating company reported a third-quarter fall in net profi, missing consensus and said its performance was hit by high raw-material costs and supply-chain disruptions.
“Despite the well flagged near-term raw mat headwinds, the underlying demand across the division remains strong and AKZO continues to benefit from the strong coatings demand as many of the end-markets move toward normalization, said a team of Citi analysts led by Mubasher Chaudhry, in a note to clients.
“Sustainability of volume and measures to combat impacts of raw material headwinds into 2022 should be a key debate point going forwards; however, shareholder returns and significant balance sheet firepower support our positive stance on the…
Read More: European earnings roll call sees Nestlé shares rise, while ASML, Akzo