Europe close: Stocks down for a second week on geopolitics, volatility gauge rockets

(Sharecast News) - Stocks on the Continent ended the session on a mixed note and with investors nursing a second consecutive week of losses. That followed a report in The Wall Street Journal according to which an Iranian strike against Israel was expected over the following two days.

Investors concern? A broader conflict in the Middle East.

The Stoxx 600 index edged up 0.14% to 505.25, but the VStoxx gauge of volatility for the Euro Stoxx 50 soared 13%.

Germany's Dax dipped 0.13% to 17,930.32 while the Cac-40 was off by 0.16% to 8,010.83.

Front-dated Brent crude oil futures meanwhile popped above $90 a barrel on the ICE - for a six-month high - and at one point gold futures soared past the $2,400/oz. mark on COMEX.

In economic data, UK GDP grew 0.1% in February following 0.3% growth the month before. The figures suggested GDP did not contract in the quarter between January and March, raising hopes that a recession was over.

German inflation fell in March, matching the lowest level since mid-2021, according to secondary estimates released on Friday. The annual rate of inflation was 2.3% last month, in line with the preliminary estimate and analysts' forecasts.

Market movers

UK housebuilders performed well in the early part of the session after positive broker commentary. JPMorgan said in a research note that it was taking a more positive stance on the sector in 2024, "as we see scope for likely positive sentiment/newsflow from the upcoming UK election (with housing expected to be a key focus) before positioning for a recovery in 2025E, likely aided by rate cuts".

Meanwhile, RBC Capital Markets upgraded its rating on Taylor Wimpey to 'outperform', saying the business "has the wind behind its sales, and we like the cut of its jib". Sector peers Persimmon, Redrow and Barratt Developments also put in decent gains.

Mining stocks in London were also providing a lift, as commodity prices continued to rise. Gold prices were up 0.75% at new record highs, while silver gained 0.99% and copper rose 0.42%. Rio Tinto, Antofagasta, Anglo American and Glencore all rose strongly.

German drug company Evotec surged 3% after Deutsche Bank analysts upgraded the stock from 'hold' to 'buy', forecasting strong earnings growth in 2024.

French bank Societe Generale added 2% a day after announcing a deal to sell its professional equipment financing business to BPCE for €1.1bn.