European stocks rise, deviating from US tech fears

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A worker assembles VW ID.3 electric cars at the Volkswagen plant on July 31, 2020 in Zwickau, Germany.

Jens Schlueter / Getty Images

European stocks advanced on Monday, diverging from the United States after a difficult week for markets.
Down 1.9% last week, the Stoxx Europe 600 SXXP,
+ 1,02%
grew by 1.1%, with car manufacturers including Renault RNO,
+ 2,86%
and Volkswagen VOW3,
+ 3,13%
moving forward.

The German DAX DAX,
+ 1,21%,
French CAC 40 PX1,
+ 1,14%
et UK FTSE 100 UKX,
+ 1,40%
also advanced.
U.S. equity futures, which will continue to trade despite the U.S. markets closing for Labor Day, were lower, especially for the tech-focused Nasdaq-100 NQ00,
-1,01%.

Last week, the tech-dominated Nasdaq Composite COMP,
-1,26%
lost 3.2%, its worst drop since the period ending March 20, and the first drop after five straight gains.
SoftBank Group 9984,
-7,15%
Stocks fell more than 7% in Tokyo on Monday, after the Wall Street Journal reported that the Japanese investment group had bought $ 4 billion in options linked to around $ 50 billion individual tech stocks .
“There was no specific trigger to sell, but after an extreme bullish driven by monetary and fiscal policies, stock prices reached levels that could no longer be justified by fundamentals,” Hussein Sayed said. , Chief Market Strategist at FXTM. “Liquidity and low interest rates alone cannot be the solution to everything, so seeing continued improvement in economic data and the end of the pandemic is essential for a sustained rise in risk assets.”
Germany reported a 1.2% increase in industrial production in July, slower than expected.
GBPUSD,
-0,72%
weakened after the Financial Times reported the UK was working on legislation to replace parts of the Brexit Withdrawal Agreement. The Sunday Express reported separately that a case is being examined by Downing Street which is said to seek to limit access for European Union companies seeking to raise funds in London. Discussions on a post-Brexit trade deal between the UK and the EU are set to resume on Tuesday.
“It seems odd, to say the least, that the UK is on the verge of undermining its commitments to Ireland with upcoming legislation after the UK recently took action in these areas. months to prepare the border of Northern Ireland for the day of the exit. This suggests that the UK is trying to increase the pressure to get a deal more to its liking rather than going for a hard exit, ”said Kallum Pickering, senior economist at Berenberg.
Associated British Foods ABF,
+ 2,61%
rose 3%, after saying that fourth-quarter trade ending Sept. 12 in its food business and retailer Primark exceeded expectations.

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