In end of the month recovery mode, the European indices strove to claw back some of the severe losses encountered following Thursday’s Q2 GDP shellacking.
As ever during this pandemic, the reasons behind Friday’s gains feel quite arbitrary, almost counterintuitive. After all, investors have woken up to a 13.8% second quarter collapse in France, wiping out 18 years’ worth of growth, a worse than forecast 18.5% contraction in Spain, and a 12.4% fall in Italy.
In the UK, notable chunks of the country have been put back in lockdown, with fury over the unclear parameters of these new measures in Greater Manchester, East and West Yorkshire and Leicester.
And there’s still the small matter of Donald Trump tweeting yesterday that he wants to delay November’s Presidential election.
And yet, in part thanks to some blockbuster earnings from the likes of Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN), and solid updates from Facebook (NASDAQ:FB) and Alphabet (NASDAQ:GOOGL), the tone of trading was positive.
It seems like Thursday’s US and German GDP figures have maybe taken the sting out of the tale of Friday’s numbers. The FTSE hauled itself back above 6000 with a 0.6% rise, while the DAX, which was dealt a hammer blow on Thursday, reclaimed 100 points to cross 12450. The CAC actually led the way with a 0.9% increase, due to that godawful French GDP reading being a smidge better than expected.
Looking ahead to this afternoon and the Dow Jones isn’t ready to match the pace set by Europe – the futures are suggesting a measly 0.2% once trading resumes stateside.
Clearly investors aren’t feeling completely comfortable, however, as evidence by gold's latest shunt higher. The safe haven commodity is now achingly close to hitting $2000 per ounce for the first time, reflecting the market’s underlying anxiety despite Friday’s surface level green hue.
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