By Peter Nurse
Investing.com - European stock markets largely weakened Friday, as optimism surrounding a potential Covid vaccine dissipates in the face of increasing numbers of coronavirus infections and the prospect of more economic pain.
At 3:45 AM ET (0745 GMT), the DAX in Germany traded 0.2% lower, the U.K.'s FTSE index dropped 0.6%, while the CAC 40 in France rose 0.1%.
The United States has reported fresh daily records for new Covid-19 case hospitalizations this week, and the news in Europe is - at least in parts - equally grim.
The U.K. reported 33,470 new cases on Thursday, the highest daily total to date, while Italy and Germany are struggling to flatten their infection curves. However, there have been clear successes in bringing down infection rates in Spain, the Low Countries and especially Ireland.
European Central Bank President Christine Lagarde cautioned Thursday that the region’s economy still faced difficult times despite U.S. pharma giant Pfizer (NYSE:PFE) reporting strong efficacy numbers earlier this week for the potential Covid vaccine it is developing, alongside Germany's BioNTech (NASDAQ:BNTX).
"From a huge river of uncertainty, we see the other side now," Lagarde said in a panel discussion. "But I don't want to be exuberant about this vaccination because there is still uncertainty" about the production and distribution of the vaccine.
Investors will look at the latest iteration of the third-quarter European growth figures later in the session, after the first estimate showed seasonally adjusted GDP increased by 12.7% in the euro area and by 12.1% in the EU, compared with the previous quarter.
In corporate news, EDF (PA:EDF) stock fell 0.4% after the French power group posted a decline in third-quarter revenue as the pandemic sapped electricity demand.
French utility Engie (PA:ENGIE) also noted a drop in operating income and revenue in the third quarter as it took a hit from the pandemic, but its stock rose 3.8%.
Oil prices weakened Friday, weighed by a surprise jump in U.S. crude stockpiles as coronavirus infections continued to rise at an alarming pace, prompting a tightening of restrictions on economic and social lift from California to Chicago and New York. The governors of Ohio, Iowa and Utah - all Republicans - all issued mask-wearing mandates.
American crude inventories rose by 4.28 million barrels, compared with an expected fall of just under one million barrels, according to data from the Energy Information Administration on Thursday.
U.S. crude futures traded 1.4% lower at $40.55 a barrel, while the international benchmark Brent contract fell 1.1% to $43.07. Both contracts are still up close to 9% this week after the jump inspired by the Pfizer vaccine news earlier in the week.
Elsewhere, gold futures rose 0.3% to $1,878.00/oz, while EUR/USD traded 0.1% higher at 1.1816.