European stocks rise as cyclicals stage a comeback
Shares rebound in Europe after US stock indexes posted their worst day in months
In Europe, the STOXX 600 Index swung between gains and losses after opening and was last down 0.6 per cent
European shares rose on Friday as cyclical stocks gained after a sharp selloff in the previous session on worries over the pace of an economic recovery from the Covid-19 crisis.
After swinging both ways after the open, the pan-European STOXX 600 index rose 0.7 per cent, rebounding from its worst single-day loss since March 23rd in the previous session. Battered shares of automakers, banks, travel and leisure and oil and gas companies - most geared to economic growth - rose between 1.5 per cent and 2.4 per cent.
In Dublin, the Iseq index was up 1.1 per cent in morning trade. Elsewhere, the FTSE 100 was 0.7 per cent higher in London, while the Dax and CAC indexes were up 1.3 per cent and 2 per cent respectively.
Healthcare and telecoms were the only two sectors in the red. Risk assets took a dive this week as a sober economic outlook from the US Federal Reserve and rising coronavirus cases in the United States reminded investors that the economic damage due to the pandemic is far from over.
The STOXX 600 is on course for a 5.3 per cent weekly loss after four straight weeks of gains and nearly 18 per cent below an all-time high hit in February.
“You have run up for so long, the market is looking for an excuse to pause,” said Neela Gollapudi, head of portfolio management and research at GenTrust. “The Fed’s Powell said we are not going to have a V-shaped recovery, and the markets were priced to perfection in terms of how quickly things are going to turnaround.”
Royal Dutch Shell, BP and Total rose nearly 2 per cent despite a drop in oil prices. France’s Interparfums surged 11.5 per cent after Italy’s Moncler entered an agreement with the company to start selling perfumes.
Italian infrastructure group Atlantia gained 3.7 per cent as it hoped for a positive solution to its row with the transport ministry over its motorway concession, but swung to a net loss in the first quarter. - Reuters