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European Stocks Gain; Entain Soars on DraftKings Interest By Investing.com


© Reuters

By Peter Nurse 

Investing.com – European stock markets traded higher Wednesday, helped by M&A action in the leisure sector and an easing of tensions around embattled Chinese property group Evergrande , ahead of a key Federal Reserve meeting.

At 4 AM ET (0800 GMT), the in Germany traded 0.2% higher, the in France rose 0.7% and the U.K.’s climbed 0.7%.

Concerns that China Evergrande Group (HK:), the country’s second largest property developer, will default on a debt pile that accounts for over 10% of all Asian high-yield debt have recently pressured equity markets around the globe.

After private talks with bondholders, Evergrande’s main unit, Hengda Real Estate Group said that it will make a bond interest repayment on Thursday.

This news doesn’t end the speculation of default, with Evergrande having an $83.5 million interest payment due on Thursday and a second $47.5 million interest payment due next week, but it boosted confidence of avoiding widespread market disorder.

The European travel and leisure industry led the charge, with Entain’s stock rising 7.4% to an all-time high. This was after Entain (LON) revealed that DraftKings (NASDAQ :), a U.S.-based casino firm had proposed a takeover offer of $22 billion.

Despite data from Morningstar showing that these banks and fund giant BlackRock were the biggest buyers Evergrande debt, UBS Group (SIX) and HSBC both posted gains on Wednesday.

Other than that, Munich’s Ifo institute reduced its German growth projections to 2.5%, from 3.3%. It did so because of the Delta-variant Covid-19 impact and disruptions in local supply chains. It did however increase its forecast for next year’s growth to 5.1%, from 4.3%.

That said, the day’s main highlight will be the conclusion of the latest , with investors looking to see whether the U.S. central bank clears the way for reductions to its monthly asset purchases later this year.

The sharp decline in U.S. oil stockpiles last week was a factor driving crude prices higher on Wednesday. The reported stockpiles fell just over 6 million barrels last week, a much bigger decline than the 2.4 million barrels expected. 

That would be a seventh straight weekly decrease if data from the later Wednesday confirms it, and indicative of lingering supply disruptions. 

By 4 AM ET, U.S. crude futures traded 1.3% higher at $71.39 a barrel, while the contract rose 1.1% to $75.16. 

Additionally, edged lower to $1,777.45/oz, while edged lower to 1.1721.

 

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Mike Robinson
Mike covers the financial, utilities and biotechnology sectors for Street Register. He has been writing about investment and personal finance topics for almost 12 years. Mike has an MBA in Finance from Wake Forest University.