Cryptocurrency NewsTop News

Stocks – Europe Seen Lower; Virus Remains a Worry

imageStock Markets12 hours ago (Jul 01, 2020 02:02AM ET)

(C) Reuters.

By Peter Nurse – European stock markets are set to open lower Wednesday, with the second half of the year starting with worries about the Covid-19 outbreak still prominent even as data releases offer hope of a global economic recovery.

At 2:00 AM ET (0600 GMT), the DAX futures contract in Germany traded 0.4% lower. France’s CAC 40 futures were down 0.1%, while the FTSE 100 futures contract in the U.K. fell 0.4%.

China’s factory activity expanded in June, with the Caixin/Markit Manufacturing Purchasing Managers’ Index rising Wednesday to 51.2 from 50.7 in May, marking the highest reading since December 2019. That followed a similarly upbeat reading from the Chinese government’s own PMI on Tuesday.

Throw in strong U.S. housing data and a rebound in consumer confidence in Europe, and the recovery from the coronavirus-inspired slump looks well underway. U.S. manufacturing activity data due later Wednesday is also expected to show a recovery from April’s depths, while the nonfarm payrolls report on Thursday is forecast to show the U.S. economy added 3 million jobs in June.

However, the resurgence of the Covid-19 virus around the world, but particularly in the U.S., the world’s economic engine, threatens to derail this nascent recovery.

The U.S. recorded 47,000 infections on Tuesday, its biggest single-day spike since the pandemic began, and this surge has prompted populous states like California, Texas and Florida to restrict economic activity once more.

“Clearly we are not in total control right now,” the country’s top infectious disease expert, Anthony Fauci, told a Senate committee on Tuesday, adding that cases could increase by as much as 100,000 daily if the outbreak is not contained.

Turning back to Europe, German retail sales jumped 13.9% in May, rebounding strongly from April’s 5.3% slump. More indications of the region’s recovery will come in later in the session in the form of manufacturing PMI data and German unemployment numbers.

In corporate news, Ryanair (LON:RYA) could receive a boost Wednesday after Europe’s biggest budget airline said it expects to fly more than 4.5 million passengers in July. This would represent a huge increase from April and May when it flew just 110,000 passengers.

On the flip side, U.K.-based budget airline easyJet (LON:EZJ) said it is considering shutting three of its airport hubs because of the steep drop in travel demand.

Oil prices pushed higher Wednesday, helped by American Petroleum Institute data showing a much larger than expected reduction in U.S. crude stocks last week, which suggests a bump up in demand even with the reemergence of the coronavirus in a number of states.

Official inventory data from the U.S. government’s Energy Information Administration is due out later on Wednesday.

At 2:05 AM ET, Crude oil WTI futures traded 1% higher at $39.67 a barrel. The international benchmark Brent contract rose 0.9% to $41.64.

Elsewhere, gold futures rose 0.1% to $1,802.45/oz, while EUR/USD traded at 1.1223, 0.1% lower.

Stocks – Europe Seen Lower; Virus Remains a Worry

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Related Articles

Back to top button

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!