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Europe Markets: Daimler Truck rises on first day of trading, bucking weaker session for European stocks

European stocks were headed for a weekly gain, but struggled for traction on Friday. Among the gainers were Daimler Truck Holding, which saw a rise in its Frankfurt market debut.

Shares of Daimler Truck Holding
DTG,

began trading at €28 euros ($31.62) a share, and were last changing hands just over that level, though reached a session high of €30.47. The initial public offering follows a spinoff from parent Daimler
DAI,
-14.37%
,
shares of which rose 1.2%, recovering from an earlier tumble due to an adjustment for that split.

Berenberg analysts Adrian Yanoshik and Romain Gourvil initiated coverage on Daimler Truck with a provisional buy rating and 35 euro price target. “Daimler Truck’s margins have credible upside from a turnaround already under way in Europe. The group’s self-help gets support from price-mix momentum into a record backlog, with strong freight markets that underpin demand,” they said.

The analysts said they were keeping a buy rating on parent Daimler, with a revised 85 euro price target to incorporate the spinoff, as they expect Daimler Truck will “re-engage investor interest in Daimler.”

“We forecast underappreciated pricing durability and higher premium market growth over the next several years,” said Yanoshik and Gourvil.

The Stoxx Europe 600 index
SXXP,
-0.16%

pared earlier losses after the release of U.S. inflation data and was last flat at 477.16, with the German DAX
DAX,
+0.02%

and French CAC 40
PX1,
-0.25%

up 0.1% each. The FTSE 100 index
UKX,
-0.14%

was trading flat.

U.S. stocks
DJIA,
+0.22%

SPX,
+0.44%

COMP,
+0.41%

opened higher as investors brushed aside November inflation data that climbed 6.8% on an annual basis that marked the highest level since 1982. The data could tip the hand of the Federal Reserve to begin tapering its bond purchases at a faster at next week’s monetary policy meeting.

Data from Germany on Friday showed prices rising 5.2% on the year, measured by national standards, confirming preliminary data and marking the highest reading since June 1992, the statistics office Destatis said.

In the U.K., October gross domestic product rose just 0.1%, falling short of expectations for growth of 0.4%.

Technology stocks were recovering from a deeper earlier slide in Europe, tracking Thursday’s 1.7% drop for the Nasdaq Composite
COMP,
+0.41%
.
Shares of ASML Holding
ASML,
+0.69%

ASML,
-0.74%

fell 0.4%, SAP
SAP,
+1.60%

rose 0.5% and Infineon
IFX,
-0.98%

dropped 0.4%.

Apparel makers were also under pressure, led by a 0.8% drop for LVMH Moët Hennessy Louis Vuitton
LVMH,
-0.38%
.

Among the biggest gainers, shares of Swedish Match
SWMA,
+7.18%

climbed 67%, after U.S. Senate Democrats were said to be dropping a proposal that would have imposed vaping taxes, The Wall Street Journal reported, citing sources.

“Concerns around the potential impact of the proposed tax changes on NGPs [Next Generation Products] has weighed on the tobacco space over recent weeks and in particular Swedish Match (-21% over the last 3-months),” said Citi analysts Simon Hales and Ravi Sharma in a note to clients.

They said Swedish Match and BAT
BTI,
+2.05%

BATS,
+2.34%

will likely see the most support from that move. BAT shares rose 1.6%.

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