European Stocks Drift Lower With U.S. Markets Shut
03 July 2020 - 5:40PM
Dow Jones News
By Avantika Chilkoti
European stocks fell Friday, with investors taking stock of a
surge in coronavirus infections in the U.S. that could impede the
global economic recovery.
The pan-continental Stoxx Europe 600 declined 0.8%, curtailing
its advance this week to just under 2%. In Asia, most major equity
benchmarks closed higher. Trading volumes were down as American
markets were shut for the Independence Day holiday.
U.S. stock futures wobbled, with contracts linked to the Dow
Jones Industrial Average ticking down 0.6%. The gauge for
blue-chips stocks ended the week up 3.3% ahead of the Fourth of
July weekend. The broader S&P 500 climbed 4% for its best
weekly performance in four, while growth stocks propelled the
tech-heavy Nasdaq Composite up 4.6%.
Coronavirus cases in the U.S. rose to another single-day high,
crossing 52,000 new infections on Thursday. The country's death
toll topped 128,700, making the U.S. the worst-hit nation globally.
The resurgence has led to calls for caution and cancellations of
festivities, and beaches in parts of Florida and California have
been closed for the holiday weekend.
Investors are balancing worries about the rising infection
level, which may prompt more stringent lockdowns and stall the
economic recovery, with signs of a revival in business activity.
Unemployment fell in the U.S. and the economy regained 4.8 million
jobs in June, according to data released Thursday, but the recent
surge in infections could throw that recovery off course.
"You get some dead-cat bounce in the data and that makes people
think the economy is recovering and maybe it'll be V-shaped, but
then you have record infections," said Lyn Graham-Taylor, a rates
strategist at Rabobank. "You're having to take everything with a
pinch of salt because we're coming off such a low base, of course
everything looks good."
In commodities, Brent crude, the international benchmark for oil
prices, fell 1% to $42.73 a barrel, amid concerns about the
economic outlook and demand for energy. The surge in new cases in
the U.S. has centered on southern states, which are particularly
large consumers of gasoline.
China's Shanghai Composite Index rallied 2% by the end of the
Asian trading day. A private gauge of China's service-sector
activity surged to the highest level in more than a decade in June,
according to new data out Friday, as the easing of virus-control
measures in most parts of the country drove demand.
Elsewhere in Asia, Japan's Nikkei 225 benchmark gained 0.7% and
Hong Kong's Hang Seng Index climbed almost 1%.
Write to Avantika Chilkoti at Avantika.Chilkoti@wsj.com
(END) Dow Jones Newswires
July 03, 2020 12:25 ET (16:25 GMT)
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