After lingering in negative territory, the pan-European STOXX 600 finished 0.1 per cent higher, led by technology, mining and real estate sectors
European stocks rose marginally yesterday to close out their best quarter since March 2015 as investors bet that the worst economic fallout from the coronavirus crisis had passed.
After lingering in negative territory, the pan-European STOXX 600 finished 0.1 per cent higher, led by technology, mining and real estate sectors.
A bounce on Wall Street also helped lift sentiment as investors focused on signs of an economic rebound even as several US states marked a record spike in new Covid-19 infections.
In Europe, the picture was mixed with German stocks rising 0.6 per cent, while UK’s FTSE 100 dropped 0.9 per cent as data showed Britain’s economy shrank by the most since 1979 in early 2020 as households slashed their spending.
Financial markets in the recent weeks have been torn between fears of a resurgence in coronavirus cases globally and positive economic data as many countries emerge from weeks-long lockdown, slowing the pace of a stock market recovery in June.
The STOXX 600 posted a 12.6 per cent rise in the second quarter ― its best since March 2015 ― as unprecedented stimulus, hopes of a Covid-19 vaccine and relatively fewer virus cases in Europe powered a rebound from March lows, but the index is down 13.6 per cent for the year.
We think that a renewed panic in financial markets is unlikely, even if cases in the US continue to rise, analysts at Capital Economics wrote in a note. The main risk to our forecast that risky assets will gain further ground in the remainder of 2020 is that the latest outbreaks slows down the economic recovery in the US.
Chipmakers STMicroelectronics, Infineon Technologies, ASM International rose between 1.6 per cent and 5.8 per cent following an upbeat revenue forecast from US-based Micron Technology.
UK energy major Royal Dutch Shell fell 3.9 per cent after revealing plans to slash the value of its oil and gas assets by up to US$22 billion (RM94.3 billion) and weakened the outlook for energy prices.
Europe’s broader energy index fell 1.4 per cent as oil prices slipped on a possible return of Libyan production.
Swedish airline SAS slumped 12.6 per cent after it agreed to a 14.25 billion crown plan with top shareholders to shore up its finances against the collapse in air travel.
Scandal-hit payments company Wirecard jumped 75.8 per cent, extending gains for a second day.
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