The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, August 6, 2020. REUTERS/Staff
August 21, 2020
By Sruthi Shankar
(Reuters) – Downbeat economic data that pointed to a stalling of the euro zone recovery hit regional stock markets on Friday, with the pan-European STOXX 600 index marking weekly losses as coronavirus cases rose across the continent.
The German DAX <.GDAXI> reversed early gains to trade 0.5% lower after Purchasing Managers Index (PMI) surveys showed service sector activity unexpectedly came to a near standstill in August, although factory activity rebounded further.
Paris-listed shares <.FCHI> fell 0.3% after a worse showing from the French survey, while euro zone blue chips <.STOXX50E> were down 0.4%.
The opening gains proved short-lived, with the wider STOXX 600 index <.STOXX> falling 0.2%, but firmer trading on Wall Street on the back of better data helped limit losses into the close.
“Today’s euro zone PMI release confirms that while activity is on the mend, the pace of the recovery is slowing,” Jai Malhi, a global market strategist at J.P. Morgan Asset Management wrote. “It’s no coincidence that the recovery is losing pace as concerns over new (coronavirus) infections have risen.”
The STOXX 600 recorded a 0.9% loss for the week, with growth-linked cyclical sectors such as banks <.SX7P>, oil & gas firms <.SXEP> and automakers <.SXAP> hit hard as several European countries saw a resurgence in coronavirus cases that raised fears of more restrictions on business activity.
London’s exporter-heavy FTSE 100 <.FTSE> slipped only 0.2%, supported by a slump in the pound on a mix of bad news on the latest Brexit negotiations and gains for the U.S. dollar. [GBP/] [.L]
Travel and leisure stocks <.SXTP> were the biggest sectoral gainers, up 3.1%, with France’s Accor
Irish building and insulation materials firm Kingspan
Swiss drugmaker Novartis
Dutch-based payment-processing company Adyen
(Reporting by Sruthi Shankar in Bengaluru; Editing by Arun Koyyur and Catherine Evans)