European markets nudge higher as investors digest data, Covid surge

European markets nudge higher as investors digest data, Covid surge
  • The acute Covid crisis in the region continues to be monitored by European markets. More countries are considering tighter restrictions and partial lockdowns to stem the rising infection.
  • Investors also examine the most recent business activity data for the region.

LONDON — European stocks rose on Wednesday after investors analyzed the latest data from the euro zone as well as the latest Covid surge in the region.

The pan-European Stoxx 600 gained 0.4% in early trade. Oil and gas stocks rose 1% to lead gains, while travel and leisure stocks fell 0.6%.

European markets continue to monitor this week’s acute Covid crises in the region, with more countries considering tighter restrictions and partial lockdowns in order to stem rising infections.

Germany is expected to take stricter measures Wednesday due to a spike in infections. France also recorded more than 35,000 new daily infections Tuesday, the first since August.

Investors are also analyzing the latest data on business activity from the region. European stocks closed lower on Tuesday despite data showing unexpected growth in euro zone business activity in November.

IHS Markit’s flash composite buying manager’s index, (PMI), a useful indicator of economic health, climbed from 54.2 in Oct to 55.8 in Nov. This was far higher than the expectations of a Reuters poll, which predicted a drop of 53.2 to 53.2.

However, optimism regarding the future of economic activity has declined. This was in the midst of a new wave of Covid-19-related infections in the region, as well as surging prices. The outlook for December was also bleak.

Overnight, U.S. stocks were little changed elsewhere. Stock futures were little affected by tech shares selling off overnight, pushed by rising rates that gave an energy boost and financial stocks. In Asia-Pacific, shares were mixed in Wednesday trade with Japanese stocks leading regional losses.

Earnings before the bell were from Johnson Matthey and Virgin Money.

Telecom Italia saw a 7% increase in share prices after a report that U.S.-based private equity giant KKR was considering increasing its buyout offer for Italy’s largest telephone company.

The British genetics company Genus was at the bottom of European blue-chip index. It dropped 7.8% following its trading update. This indicated that full year profit before taxes would likely be moderately higher than previously estimated.

Wednesday morning will see the publication of the latest Ifo Business Climate Survey from Germany.

Leave a Reply

Your email address will not be published. Required fields are marked *