Caution prevails in Europe in the face of health and economic uncertainties

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Caution prevails in Europe in the face of health and economic uncertainties


MARCHES-SYNTH-SE-3: Caution dominates in Europe in the face of health and economic uncertainties


EUROPEAN SCHOLARSHIPS OPEN SLIGHTLY


© Reuters / Michalis Karagiannis
EUROPEAN SCHOLARSHIPS OPEN SLIGHTLY


by Laetitia Volga

PARIS (Reuters) – Most European stock markets fell slightly in early trading on Thursday, fears that the reinstatement of health restrictions would slow the pace of the economic recovery prompting investors to be cautious.

In Paris, the CAC 40 index lost 0.25% to 5,932.7 points around 09:00 GMT. In Frankfurt, the Dax lost 0.19% and in London, the FTSE gained 0.23%.

The EuroStoxx 50 index for the euro zone fell 0.25%, the FTSEurofirst 300 was stable (+ 0.02%) and the Stoxx 600 fell 0.11%.

The main concerns of investors remain the continued deterioration of the health situation after the tightening of restrictions decided by several European countries to curb the spread of the coronavirus.

Prime Minister Boris Johnson on Wednesday announced that Britain may impose new, tougher measures on arrivals from France, particularly on motor carriers.

Concerns over disruptions in the distribution of coronavirus vaccines are also weighing on investor sentiment. The European Commission presented on Wednesday a project to tighten export conditions for vaccines produced in the EU which will be debated this Thursday by the leaders of the 27.

VALUES

The energy sector posted the largest drop in early trading in Europe, its Stoxx index fell 1.36%, ahead of that of basic resources (-0.89%).

In Paris, TechnipFMC is the red lantern of the ACC with a decline of 2.71%.

The Scor share varies little (-0.13%) despite the complaint filed by Covéa with the National Financial Prosecutor’s Office against the CEO of the French reinsurer, Denis Kessler, for price manipulation and abuse of corporate assets.

H&M is down 1.11% as the Swedish clothing giant appears to be the subject of a boycott on Chinese shopping sites after expressing concern over charges of forced labor in Xinjiang.

Adidas, which is also the subject of criticism in China, fell 3.98%.

In London, Cineworld drops 10.66% after announcing it will ask shareholders to approve an increase in its debt ceiling to allow it to borrow more to balance its finances after a loss of 3 billion of dollars (2.5 billion euros) in 2020.

Compass, the world number one in collective catering, takes 1.33% after said to forecast an improvement in its margins in the second quarter thanks to a reduction in costs.

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A WALL STREET

Futures on the major Wall Street indices are so far pointing up 0.2% to 0.4% on Thursday after a lower close the day before despite optimistic remarks from Federal Reserve Chairman Jerome Powell and by US Treasury Secretary Janet Yellen on economic recovery.

The Dow Jones index ended almost unchanged (-0.01%) at 32,420.06 points and the S & P-500 lost 0.55% to 3,889.14 points.

The Nasdaq Composite fell by 2.01% to 12,961.89 points.

Investors turned their backs on major tech stocks for a second day in a row amid swings into the energy and financial sectors amid the prospects for increased growth.

IN ASIA

The Nikkei on the Tokyo Stock Exchange finished up 1.14%, supported by the advance of cyclical stocks which more than offset the decline in the technology sector.

In Hong Kong, the rise in financial and consumer-related stocks also helped offset the decline in technology, in the wake of the Nasdaq and the announcement by the Securities and Exchange Commission (SEC).

The US stock market policeman on Wednesday adopted measures to exclude foreign companies from the stock market in the United States if they do not comply with US accounting standards. Chinese companies are particularly targeted and technology groups with a double listing in Hong Kong and New York are falling sharply.

Baidu lost 9.65%, Alibaba was down 3.91%, and JD.Com was down 3.57%.

The Hang Seng Index of the Hong Kong Stock Exchange finished without much stable change (-0.06%), as did the CSI 300 of mainland Chinese large caps (-0.05%).

RATE

The ten-year Treasuries yield recovered to a basis point at 1.6244% after a series of three consecutive sessions of decline which took it to a one-week low on Wednesday, at 1.589%.

In the European bond market, benchmark yields fell slightly: that of the ten-year German Bund was down one point to -0.367%.

CHANGES

The dollar, which still benefits from its status as a safe haven amid uncertainty over growth, is up 0.18% against a basket of currencies.

The euro is down 0.08%, around $ 1.18, the lowest since November.

OIL

Crude prices are falling, penalized by containment measures in Europe which raise fears for the outlook for energy demand despite the support provided by the blockage of the Suez Canal, which could create tensions on supply.

A barrel of Brent fell 1.41% to 63.5 dollars and US light crude 1.68% to 60.15 dollars.

(edited by Patrick Vignal)

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