LIVE MARKETS-Share repurchases: an increasing tailwind for Europe
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SHARE REPURCHASES: AN INCREASING TAILWIND FOR EUROPE
Share repurchases are becoming an increasing tailwind for Europe, Barclays believes, as companies recorded their third largest year for buybacks in 2024.
Firms in Europe's STOXX 600 index .STOXX announced share buyback programmes worth about 290 billion euros last year, according to Barclays.
"Given Europe's fragile macro backdrop - weak macro data, concerns around potential policies of the incoming Trump administration in the US and China hazard, some self-help is needed for the equity market, and we believe buybacks should be considered as a theme," Barclays writes.
"Share buybacks appear to help mitigate downside stock market pressure."
According to Barclays, stocks with a higher proportion of their volume generated by buybacks experienced significantly lower average drawdowns compared to the overall market.
With fourth quarter earnings season in Europe getting underway, Barclays expects "strong announcement activity" in relation to buybacks.
"Alongside the improving earnings prospects for EU companies, the increased intentions for capital returns likely reflect robust corporate fundamentals," Barclays says.
(Samuel Indyk)
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THURSDAY'S OTHER LIVE MARKETS POSTS:
UK ROUT: BORN IN THE USA? CLICK HERE
ROOM FOR U.S. EQUITIES AND CREDIT TO OUTPERFORM ON TARIFF NEWS - JPM CLICK HERE
EUROPEAN SHARES STRUGGLE FOR DIRECTION; RETAILERS SOFT CLICK HERE
EUROPE BEFORE THE BELL: FUTURES MOSTLY LOWER CLICK HERE
BRITAIN AT CENTRE OF BOND MARKET STORM CLICK HERE
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