European stocks open higher after upbeat H&M, STMicro results

(Reuters) – European stocks rose on Thursday as Swedish retailer H&M and French-Italian chipmaker STMicroelectronics jumped after reporting forecast-beating results, while hopes of more U.S. stimulus aided global sentiment.

The pan-European STOXX 600 index <.STOXX> rose 0.7% by 0707 GMT, with bourses in Paris <.FCHI> and London <.FTSE> up over 1%, while German stocks <.GDAXI> rose 0.3%.

H&M rose 5.6% as it reported a third-quarter profit above analysts’ expectations and said sales continued to recover in September. The retail index <.SXTP> rose 1.3% to lead sectoral gains.

STMicroelectronics jumped 3.5% after it forecast 2020 sales above previous estimate.

After European markets ended the third quarter in a subdued manner on worries about a resurgence in European COVID-19 cases, Brexit deal and the United States election, the mood brightened on Thursday amid signs of progress in a U.S. fiscal bill.

Final readings of September manufacturing activity for the euro zone and UK are due later in the day, with economists expecting recovery to remain intact after a coronavirus-induced hit.

German drugs company Bayer AG slumped 12% to the bottom of STOXX 600 after announcing plans for more than 1.5 billion euros ($1.76 billion) of cost cuts as of 2024 and revealing impairment charges on its agricultural business.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Shounak Dasgupta)