European Stocks Just Hit Record Highs Again. Here Is What Is Driving the Rally

TLDR

• The STOXX 600 rose 0.3% on Friday, hitting fresh record highs for a fourth straight week of gains
• Healthcare stocks led the way, rising 1.8%, with Genmab jumping 9.6% on strong results
• Kingspan surged over 15% after raising its profit forecast on surging data centre demand
• European companies are now expected to post Q2 earnings growth above 22%, the strongest since Q3 2022
• Markets stayed cautious ahead of US jobs data, with higher oil prices adding to inflation concerns

European stocks finished the first week of August on a high, with the STOXX 600 and STOXX 50 both hitting record levels for the fourth week running.

The STOXX 600 rose 0.3% to 659.91 points by mid-morning on Friday. The STOXX 50 gained 0.2% on the day and ended the week up 2.4%.

A busy earnings season was the main driver of gains. Companies across the index are now forecast to report second-quarter earnings growth of more than 22%, according to data from LSEG. That would be the strongest growth rate since the third quarter of 2022.

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