European stocks rebound as oil, travel stocks jump

British shares trade flat as climbing Covid-19 cases weigh on sentiment

Photograph: iStock

Photograph: iStock

 

European stocks steadied on Tuesday after declining in the last session, as investors looked to the upcoming earnings season and focused on the prospect of larger US stimulus under incoming president Joe Biden.

The pan regional Stoxx 600 index rose 0.4 per cent by 0811 GMT, with the oil and gas, and travel and leisure sectors climbing more than 1 per cent each to lead the gains.

Investors booked profits on Monday following last week’s rally after a Democrat sweep in the US Senate elections raised expectations of larger US fiscal stimulus.

Oil majors BP, Royal Dutch Shell and Total gained as crude prices rebounded on expectations of a drawdown in US crude oil stockpile.

Danish shipping company Maersk rose 2.8 per cent after brokerage Berenberg upgraded the stock to “buy”, saying earnings momentum driven by freight prices could see the stock run higher.

Swedish online gaming company Kindred jumped 5 per cent after it reported strong business momentum through the fourth quarter, while Renault rose 1.5 per cent after the French automaker said its started 2021 with a higher level of orders than in 2019.

British shares traded flat on Tuesday as a set of positive earnings updates helped boost confidence in the economy’s recovery, while investor worries over climbing coronavirus cases weighed on sentiment.

The blue-chip FTSE 100 index was flat with energy and retail stocks gaining the most, with retailer Kingfisher being the top gainer on the index. The home improvement retailer rose 3.4 per cent after reporting strong trade across its markets with fourth-quarter to January 9th underlying sales up 16.9 per cent. E-commerce retailer The Hut Group gained 3.1 per cent after it raised 2021 revenue forecast by 10 per cent, underpinned by its acquisition of Dermstore. com and a surge in online demand for its beauty products.

However, gains were capped on Finance Minister Rishi Sunak’s warning on Monday that Britain’s economy would get worse before it got better, with the country now in its third national lockdown and as it struggles to contain the spread of Covid-19. – Reuters