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europe-markets:-european-stocks-attempt-to-gain-as-focus-remains-on-global-pandemic-spread
europe-markets:-european-stocks-attempt-to-gain-as-focus-remains-on-global-pandemic-spread

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Europe Markets: European stocks attempt to gain as focus remains on global pandemic spread

Europe Markets

Second-quarter earnings reporting begins next week

Brides wearing their wedding dresses hold a flashmob protest against the postponement of their marriages due to the strict protocol on all religious ceremonies during the coronavirus pandemic, on June 7, 2020, by the Trevi Fountain in Rome, Italy.


AFP via Getty Images

European stocks were headed for a weekly loss, amid continued concerns over the spread of coronavirus in the U.S. and fresh outbreaks elsewhere in the world, though equities attempted to push higher on Friday.

Shaking off an opening loss, the Stoxx Europe 600 index
XX:SXXP
rose 0.6% to 366.08 after three straight losing sessions. The index has lost 0.8% for the week so far. Elsewhere, the German DAX
US:DAX
was up 0.8%, the French CAC 40
FR:PX1
was up 0.7% and the FTSE 100 index
UK:UKX
rose 0.7%.

U.S. stock futures were modestly lower, with those for the Dow Jones Industrial Average
US:YM00
down 68 points. The Dow
US:DJIA
dropped over 300 points on Thursday, with the S&P 500
US:SPX
also closing lower, though the Nasdaq Composite
US:COMP
resumed an advance with a 0.5% again.

Coronavirus concerns dominated after the U.S. saw its sixth daily record for coronavirus cases in 10 days on Thursday, with fatalities also rising in some states. “The closure of schools in Hong Kong and the further tightening of virus restrictions in Australia has also fed into the underlying negative mood at the end of the week,” said Michael Hewson, chief market analyst at CMC Markets, in a note to clients.

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Read:Despite stock gains, investors still doubt prospects for V-shaped recovery, says Morgan Stanley

Asian markets fell, reflecting fears any global economic recovery may stall out amid those climbing cases, with Tokyo also reporting an increase in infections. The China CSI 300 index
XX:000300
halted an eight-session winning streak, with a loss of 1.8%. The index has climbed 14% this month, driven in part by articles in government-backed newspapers cheering on the market. That has raised questions over whether China’s latest rally will collapse on itself like it did in 2015.

Some economic cheer came from Italy, which said May industrial production jumped 42.1%, while France also saw that its production rebounded strongly. The U.K. has announced it will allow the reopenings of gyms, tattoo parlors, and swimming pools.

Still, investors are increasingly facing up to the fact that “any economic recovery is unlikely to be V-shaped in nature, with a range of companies starting to announce thousands of job losses this week,” said Hewson.

“This month alone we’ve seen John Lewis, Boots, Burger King, Rolls-Royce, Airbus, Upper Crust, and Harrods, to name but a few, announce thousands of job losses, in addition to the cuts announced last month from the major airlines, energy and car companies which has pushed the total of jobs at risk up to well over 100,000,” he said.

Investors will begin to hear how companies have been holding up during COVID-19, with next week marking the start of second-quarter earnings season.

Among the gainers, technology stocks fed off U.S. strength in that sector, with STMicroelectronics
IT:STM
rising 2.6%, and Infineon Technologies
DE:IFX
rising 2%. ASML Holding
NL:ASML
shares gained 2%.

A recovery for shares of oil companies helped Europe turn positive. Crude prices
US:CL
remained weak, but shares of BP
US:BP
UK:BP
and Royal Dutch Shell Group
US:RDS
UK:RDSA
rose around 0.5% each from a 1% drop earlier. The International Energy Agency boosted its forecast for 2020 oil demand, but also warned that the pandemic could hamper that view, Reuters reported.

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