Investing.com | Oct 15, 2020 08:45
By Peter Nurse
Investing.com - European stock markets traded sharply lower Thursday, with investors worrying about resurgent Covid-19 infections stifling economic activity as hopes die of U.S. stimulus before the election.
Concerns that a resurgence in the Covid-19 pandemic could lead governments throughout Europe to shut down their economies again has hit the confidence of investors, particularly after the recent stock rally.
New cases are hitting 100,000 daily in Europe. Nearly 20,000 infections were reported in Britain, while the French government on Wednesday declared a public health state of emergency. Hospital admissions are also now clearly on an upward trend, although the number of deaths is still far below the spring peaks.
Germany, France, the U.K., and others are in the process of instituting measures such as limited lockdowns, bar closures and other systems intended to reduce the spread of infection.
Across the Atlantic, meanwhile, the chance of additional U.S. stimulus ahead of the elections in early November seems to have disappeared.
"Getting something done before the election and executing on that would be difficult," U.S. Treasury Secretary Steve Mnuchin said on Wednesday, adding that he and Democrat House Speaker Nancy Pelosi are still "far apart" on their spending priorities.
Also weighing are concerns that the EU and Britain--the world's largest trading bloc and the sixth-biggest economy--will struggle to come up with a trade deal ahead of the year-end deadline.
European Union leaders are set to meet in Brussels later Thursday to discuss progress, or the lack of it, on the tricky issues of fisheries, competition and dispute resolution.
In corporate news, Roche (SIX:RO) stock fell 2.9% after the Swiss pharmaceutical major said Thursday that sales fell in the period from January to September compared with the previous year.
Ryanair (LON:RYA) stock led airlines lower as the company said it will cut its winter schedule to 40% of capacity from the 60% it had previously aimed for.
Marston’s (LON:MARS) stock fell 3.6% after the British pub owner warned of over 2,000 job losses as the restrictions brought in to combat the pandemic were hitting sales.
Oil prices edged lower Thursday, retreating slightly despite a larger-than-expected draw in U.S. crude supply amid worries about the rising number of coronavirus cases and the impact this could have on demand.
The American Petroleum Institute industry group said U.S. crude stockpiles fell by 5.4 million in the week to Oct. 9, nearly double analysts' expectations.
The U.S. Energy Information Administration is due to release its weekly data on Thursday, a day later than normal following a public holiday. Also of interest will be the meeting of the Organization of the Petroleum Exporting Countries’ joint technical committee meeting later in the day, to discuss the group’s production levels.
U.S. crude futures traded 0.6% lower at $40.80 a barrel, while the international benchmark Brent contract fell 0.6% to $43.06.
Written By: Investing.com
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