European markets retreat on virus concerns; euro ends higher against dollar
July 03 2020 08:53 PM
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The walkway seen outside the London Stock Exchange building in Paternoster Square. The FTSE 100 clos
The walkway seen outside the London Stock Exchange building in Paternoster Square. The FTSE 100 closed down 1.3% to 6,157.30 points yesterday.

AFP, Reuters London

European stock markets retreated yesterday, with concerned investors locking in gains made recently on solid US jobs data.
In London, the FTSE 100 index had lost 1.3% when trading ended for the day, Frankfurt had slipped by 0.6% and Paris was off by 0.8%.
The euro was slightly higher versus the dollar, and unchanged against the British pound.
In London, the FTSE 100 closed down 1.3% to 6,157.30 points; Frankfurt — DAX 30 ended down 0.6% to 12,528.18 points; Paris — CAC 40 closed down 0.8% to 5,007.14 points and EURO STOXX 50 ended down 1.0% to 3,287.29 points yesterday.
Key oil prices retreated by less than half a per cent, meanwhile.
Analysts said that concern over a potential resurgence of Covid-19 cases had weighed on European markets, which did not receive support from New York later in the day because US markets were closed ahead of the July 4 holiday.
“Without the prop of US markets keeping them up, European indices have taken a tumble, shedding ground as the week draws to a close,” said market analyst Chris Beauchamp at IG, an online trading group.
“A rise in virus deaths in a number of US states proves that, sadly, Covid-19 does not take holidays, and should remind everyone that this crisis is far from over.”
Playing catch-up with Thursday’s US employment figures, Hong Kong had added 1% earlier in the day, while Tokyo gained 0.7% and Shanghai jumped 2% with traders choosing to look beyond China-Hong Kong tensions.
But “now that the dust has settled in regards to the 4.8mn jobs that were added in the US last month, dealers might reflect on the fact that the continuing claims reading actually ticked up,” noted David Madden, analyst at CMC Markets UK.
While the US employment data gave a boost, new jobless claims remained elevated last week at 1.43mn.
Wall Street ended a shortened-trading week Thursday with another record-high for the tech-rich Nasdaq, with hopes for the economic recovery offsetting sharp increases in US coronavirus cases and as several states tightened restrictions ahead of the July 4 celebrations.
The pan-European STOXX 600 index was largely flat after opening marginally higher, with trading volumes thinned by a US market holiday.
Technology stocks led the gains, rising 0.7%, while banks, insurers and oil & gas fell after a strong rally in the previous session.
The benchmark index was headed for a 2.8% weekly gain as hopes of a Covid-19 vaccine and a series of strong data pointed to a global economic recovery from the health crisis.
But Investors are sceptical of further gains in equities as the United States set a new daily global record for Covid-19 cases on Thursday, driving several US states to delay their reopening plans.
“The fear of another big(ger) drop in equity prices continues to haunt financial markets. The opportunity to engage in European assets also seems a bit limited,” Thomas Flury, head of FX strategies at UBS Global Wealth Management wrote to clients.
“For this, clearer signs of a recovery in international trade should be visible. The data on this is constructive, but not surprising to the upside.”
A private survey showed that China’s services sector expanded at the fastest pace in over a decade in June as the easing of lockdown measures revived consumer demand, though companies continued to shed jobs.
Paris’s blue-chip CAC 40 slipped 0.3% as French Prime Minister Edouard Philippe resigned ahead of a government reshuffle by President Emmanuel Macron designed to win back disillusioned voters ahead of a possible re-election bid.
Among individual movers, Germany’s Delivery Hero jumped 5.5% after the takeaway food company said its order growth nearly doubled in the second quarter.
France’s utility firm EDF rose 4.8% after it revised upwards its 2020 nuclear output target.
UK retailer Next fell 2.5% after Goldman Sachs downgraded the stock to “sell”, while Primark-owner AB Foods slipped 1.3% after the US bank downgraded its stock to “neutral”.



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