Europe’s best performing stocks in Q3

Although the coronavirus pandemic is still hanging over the stock market, Q3 saw attention turning to the recovery prospects after the damage dealt in the first half of the year.

Here are some of the best and worst performers in the quarter just ended.

M&A activity picks up

Covid-19 slammed the brakes on M&As during the first half, with the value of deals conducted dropping -64% on the year during Q2. Things have rebounded sharply in Q3, with deals down only -8.4%.

G4S registered the best performance of all Stoxx 600 shares in Q3, with the stock up 76% largely thanks to an approach from Canada’s GardaWorld.

A $9.2 billion deal to buy Ebay’s classifieds business help push the stock of Norway’s Adevinta up 65%.

Suez also got a boost from M&A after Veolia Environment offered take a 29.9% stake in the company in the first step towards a full takeover.

EU green plan boosts renewable stocks

ESG (environment, social, and governance) investing helped stocks with an environmental focus race ahead of the wider market in Q3.

Vestas jumped 53% and Siemens Gamesa leapt 46%. Both are in the field of wind power. Finnish refiner Neste upped its investment into renewables and saw its stock rise nearly 30%.

Lockdowns create home improvement boom

The reality of being stuck at home for a long time, or needing to prepare a space for homeworking, has fuelled a DIY boom that made Kingfisher and Kesko two of the top 20 performing European stocks in Q3.

The UK’s Kingfisher hit a level not seen in over two years, while Finland’s Kesko came close to notching a new record high.

Gold miners flourish as safe-haven demand persists

Safe-haven demand, and a bet that vast central bank and government stimulus measures will eventually spark strong inflation, continued to support gold in Q3. Fresnillo was the best-performing gold miner, followed by Centamin and Polymetal.

Q3 disappointments

Healthcare stocks were some of the worst performers in Q3, despite having surged in the first half of the year. The impact of the pandemic upon elective procedures saw Ambu trim its outlook and deliver some of the sector’s worst returns. Meanwhile, Galapagos tumbled over -30% after its rheumatoid arthritis treatment failed to get approval from the US Food and Drug Administration.