European Stocks Rise a Fourth Day With Defensives in the Lead

(Bloomberg) -- European stocks posted their longest winning streak in six weeks as investors focused on easing lockdowns and a stimulus plan to support the economy, while U.S. data also boosted sentiment.

The Stoxx 600 Index rose 1.6% at the close, with defensives such as health-care and personal and household-goods shares leading gains. After rallying hard in recent sessions, cyclicals were back at the bottom.

The Stoxx 600 is at its highest level since early March, recouping more than half of the losses from a selloff that began in February. Data on Thursday showed U.S. states’ jobless rolls shrank for the first time during the coronavirus pandemic, adding to optimism over reopenings and a European Union fiscal stimulus plan.

The European benchmark rose even after Chinese lawmakers approved a proposal for sweeping new national security legislation in Hong Kong, defying a threat by U.S. President Donald Trump to respond strongly.

“One of the assumptions investors are making right now, the reason why markets are going higher, is there’s this belief that we’re entering the time of the presidential election, so Trump in a way is trying to look very aggressive to China,” Luca Paolini, chief strategist at Pictet Asset Management, said on Bloomberg TV. “So the assumption is it’s just a war of words, but given the market’s gone up so much it’s probably better to be a little more cautious.”

Among individual stock moves, Cineworld Group Plc jumped 21% after securing a leverage covenant waiver and agreeing on terms of additional liquidity.

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