M&A activity raises European shares despite Brexit fears

European stocks ended a volatile trading session higher yesterday, as investors were balancing indications of an increase in M&A activity and an economic threat resulting from the growing prospects for a no-deal Brexit from the European Union.

According to "Reuters", the European Stoxx 600 index rose 0.1 per cent and ended the week with an increase of nearly 1.8 per cent. The index has been confined to a limited range since June, as economic growth lost momentum due to the strengthening of the euro and the increase in the cost of European exports. Meanwhile, the European Union is intensifying preparations for a tumultuous end to the four-year saga of Britain's exit from the bloc, as senior officials prepare to inform the 27-nation bloc of British Prime Minister Boris Johnson's intention to violate the secession treaty. Most of the major sector indices fell a day after the European Central Bank kept interest rates unchanged, and said it is closely monitoring the euro.

Oil and gas stocks were the biggest losers, as oil prices fell, while defensive stocks such as health care, telecommunications and real estate rose.

Mergers and acquisitions activity topped the scene, as Altes Europe jumped 24.2 percent to a three-month high, and topped the Stokes 600, after it was agreed to buy it by its founder Patrick Drahi.

On Wall Street, US stocks opened higher yesterday, supported by heavyweight technology stocks, as quarterly results exceeding expectations for "Oracle" confirmed the robustness of technology-related companies during the coronavirus crisis. According to "Reuters", the Dow Jones Industrial Average rose 79.28 points, or 0.29 percent, to 27,613.86 points.

And the Standard & Poor's 500 Index opened, up 13.51 points, or 0.40 percent, to 3,352.70 points, and the Nasdaq Composite Index gained 90.47 points, or 0.83 percent, to 11,010.07 points. In Asia, Japanese stocks rose to their highest level in a week yesterday, following the rise of US futures, after the capital, Tokyo, reduced the level of the Corona virus warning by a degree from its highest levels, while infections continued to decline.

The Nikkei index rose 0.74 percent to 23,406.49 points. For the week, the index gained 0.87%.

The Broader Topix index rose 0.7 percent to 1636.64 points, while all sub-indices of the 33 sectors in the Tokyo Stock Exchange rose, except for four. The index made its third weekly gain.

The two indicators reached their highest levels since the third of September.

The markets opened lower at the beginning of trading, tracking losses incurred by Wall Street the first day, as heavy American technology stocks continued their decline after a strong rebound last Wednesday.

But stocks compensated for their losses, following the rise in US futures in Asian trading. Shares of shipping companies topped the list of the best performing sectors in the main stock exchange, rising 3.16 percent, while Meiji Shipping Company jumped 5 percent and Mitsui O.S.K Lines gained 3.57 percent.

Masahiro Ichikawa, chief analyst at Sumitomo Mitsui DS Asset Management, said that the market is awaiting some events next week, including the leadership elections of the ruling Liberal Democratic Party in Japan, and meetings to consider monetary policy at the Bank of Japan and the Federal Reserve (U.S. Central Bank).

In Pakistan, the Karachi Stock Exchange index, the largest Pakistani stock market, ended the trading session yesterday, down 0.27 percent, equivalent to 116 points, and closed at 42530 points. The volume of traded shares reached 309,721,854 shares, and shares of 381 companies were traded, of which the value of the shares of 154 companies increased, the value of shares of 216 companies decreased, and the value of shares of 11 companies stabilized.

In the Arab world, the Egyptian Stock Exchange lost about 10.5 billion pounds during last week’s transactions, bringing the market capitalization of companies ’shares to about 616.8 billion pounds. Collectively, the performance of the main and secondary market indices rose, as the main stock market index "EGX30" jumped by 1.29 percent to close at 11,070.84 points, and the index of small and medium stocks "EGX 70" rose by 3.11 percent, recording 1,857.08 points, he added. The broader EGX 100 index, towards 2.84 percent, to end trading at 2736.44 points.

The weekly report of the Egyptian Stock Exchange indicated an increase in trading values ​​to reach 21 billion pounds, through the circulation of 1.919 billion papers on 205 thousand transactions. He explained that the transactions of Egyptian investors accounted for 81% of the total market transactions, and that foreign investors accounted for 11% and Arabs accounted for 7% after excluding the deals.

The report pointed out that foreign investors transactions recorded a net sale of 1.8 million pounds, and that Arab investors' transactions recorded a net sale of 6.5 million pounds.

In Jordan, the general price index for shares listed on the Jordanian Stock Exchange increased by 0.04 percent, to end the week's trading at 1587.9 points.

The daily average of trading volume at the Amman Stock Exchange during the past week was about 4.7 million Jordanian dinars, compared to 4.1 million Jordanian dinars the previous week, a rise of 14.7 per cent, while the total weekly trading volume was about 23.6 million Jordanian dinars, compared to 20.5 million JD for the previous week. As for the number of traded shares recorded by the Stock Exchange during the past week, it reached 35.8 million shares, executed through 14,812 transactions.