European Stocks Advance the Most in a Month


European stocks rose the most in a month after better-than-expected forecasts from Schneider Electric SA and Lonza Group AG eased concern profit growth is slowing.

Schneider, the world's biggest producer of circuit breakers, had its steepest advance in three months. Lonza Group, the largest maker of drug ingredients, climbed after saying it expects full-year earnings to exceed its target. ArcelorMittal, the biggest steelmaker, rallied after HSBC Holdings Plc raised its recommendation on the shares.

The Dow Jones Stoxx 600 Index added 1.4 percent to 381.24 at 2:25 p.m. in London as all industry groups gained. The Stoxx 50 rose 1.1 percent, and the Euro Stoxx 50, a measure for the euro region, increased 0.8 percent.

``The market is going to be driven by earnings and company statements,'' said Mark Webster, senior investment manager at State Street Global Advisors in London. ``Valuations are still attractive. The market will focus on companies with sustainable growth.''

The risk of owning European corporate bonds fell, according to traders of credit-default swaps.

National benchmarks rose in all of the 18 western European markets. The U.K.'s FTSE 100 added 1.5 percent. France's CAC 40 gained 1.2 percent and Germany's DAX increased 1 percent.


Bloomberg
10/23/2007 6:56:48 AM