European Stocks Lower; Caution Amid Lockdown Worries

This post was originally published on this site
https://i-invdn-com.akamaized.net/news/LYNXNPEEAC0LE_M.jpg

Investing.com – European stock markets weakened Monday, starting the week on a cautious note with investors focusing on developments surrounding the pandemic and vaccine rollouts.

At 3:50 AM ET (0850 GMT), the DAX in Germany traded 1.3% lower, the CAC 40 in France fell 1.1%, and the U.K.’s FTSE index dropped 1.1%.

U.K. Prime Minister Boris Johnson will set out a roadmap to ease England’s third national lockdown on Monday, having met a target to vaccinate 15 million Britons from higher-risk categories by mid-February.

That said, Johnson has stressed the need to avoid complacency, and the lockdown will only be lifted slowly. Newspaper reports suggest that the travel and hospitality industry is unlikely to be functioning anywhere near normality by the important Easter break.

This sector has been battered by the mobility restrictions put in place to combat the transmission of the virus. Earlier Monday, British Airways-owner IAG (LON:ICAG) said it has raised total liquidity by 2.45 billion pounds ($3.4 billion), reaching final agreement for a 2 billion pound loan, and striking a deal to defer 450 million pounds of pension contributions. Its stock rose 0.6% in an overall weaker day.

The U.K. has been the bright spot in Europe in terms of the speed of its vaccination rollout, and concerns exist that continental Europe will still be locked down for some time to come. Indeed, the mayor of Nice in southern France called Sunday for a weekend lockdown to reduce the flow of tourists as it battles a sharp spike in coronavirus infections.

European Central Bank President Christine Lagarde is set to give a speech later Monday, while Germany’s Ifo business climate index rose by more than expected in February, with both current performance and expectations coming in stronger. Manufacturing remained the strongest sector. .

In other corporate news, Galp Energia (LS:GALP) stock fell 3.2% as the Portuguese energy company posted a loss in the fourth quarter, while G4S (CSE:G4S) stock slumped 9.8% after GardaWorld said it would not revise its 235p/share offer for the British private-security company. 

French car parts maker Faurecia (PA:EPED) lost 3.4% even after it targeted its sales close to 25 billion euros ($30.29 billion) and an operating margin above 8% of sales by 2025.

Oil prices climbed Monday as U.S. production returned only slowly from last week’s severe cold snap, further tightening a global market where inventories have fallen sharply in recent weeks.

It will likely take several more days for oilfield crews to get production fully up again after the cold snap in Texas, the largest crude producing U.S. state, and the surrounding region forced the shut down of an estimated 4 million barrels per day in output.

U.S. crude futures traded 0.5% higher at $59.55 a barrel, while the international benchmark Brent contract rose 0.6% to $62.53.

Elsewhere, gold futures rose 0.9% to $1,792.70/oz, while EUR/USD traded 0.1% lower at 1.2102.

Add Comment