European Stocks Slip; Consolidating as Covid Cases Rise

European Stocks Slip; Consolidating as Covid Cases Rise

Investing.com  | Jan 11, 2021 08:56

European Stocks Slip; Consolidating as Covid Cases Rise

By Peter Nurse 

Investing.com - European stock markets traded mostly lower Monday, consolidating after recent gains amid rising Covid-19 cases globally.

At 3:55 AM ET (0855 GMT), the DAX in Germany traded 0.9% lower, the CAC 40 in France fell 0.5% and the U.K.'s FTSE index dropped 0.6%.  

There were, however, significant outliers, with the STOXX Technology index hitting another all-time high, and U.K. sports gear retailer JD (NASDAQ:JD) Sports Fashion (LON:JD) rising 4.5% to an all-time high after reporting a strong Christmas trading season.

Stock exchange operator Euronext has resolved a technical issue that affected trading on futures contracts tied to the CAC 40.

Many European countries are battling a surge in Covid-19 cases following the emergence of a new highly transmissible strain of the virus, racing to vaccinate their elderly, the most vulnerable members of society.

Cases are also increasing globally, with mainland China seeing its biggest daily increase in more than five months, the country's national health authority said on Monday. This has prompted a lockdown in Shijiazhuang, the capital of the province of Hebei and the epicenter of the new outbreak.

China had recovered better than any other major economy from the Covid-19 hit, with the manufacturing sector, in particular, thriving as global consumers switched demand to (often Chinese-produced) goods from locally produced services.

Losses are likely to be limited following the solid start to 2021 as investors remain focused on the prospect for additional fiscal stimulus in the U.S. after a Democratic sweep of Congress. This remains the case even after the violent scenes on Capitol Hill last week that continue to reverberate. 

The economic data slate is largely empty Monday, while in the corporate sector, British Land (OTC:BTLCY) stock fell 1.8% after the U.K.'s largest commercial landlord reported a drop in rental collection in December, with only 46% of retail rents paid in full and on time.

Swiss healthcare giant Roche (SIX:RO) stock rose 0.4% after receiving EU approval for its influenza treatment Xofluza, and Sanofi (PA:SASY) (NASDAQ:SNY) stock rose 0.7% after agreeing to buy U.K. pharmaceutical group Kymab. 

Oil prices weakened Monday amid concerns of declining fuel demand following a jump in new Covid-19 cases in China, the world’s second-largest consumer of crude.

Still, prices remain above the $50 a barrel level, supported by Saudi Arabia's surprise pledge last week to cut output by 1 million barrels per day for two months.

U.S. crude futures traded 0.7% lower at $51.87 a barrel, while the international benchmark Brent contract fell 0.9% to $55.50. 

Elsewhere, gold futures rose 0.7% to $1,848.80/oz, while EUR/USD traded 0.2% lower at 1.2188.

 

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