European markets closed weak on Tuesday, weighed down by some disappointing economic data from the region, and a sharp drop in crude oil prices after OPEC+ abandoned talks after failing to agree on production policy.
Worries about the spread of the delta variant of the coronavirus and weakness in U.S. markets contributed as well to the negative sentiment in Europe.
Travel- related stocks moved higher after Germany announced plans to lift travel restrictions on fully vaccinated travelers from the U.K., and Portugal.
Shares of oil companies fell as crude oil prices retreated after hitting a six-year high.
The pan European Stoxx 600 shed 0.52%. The U.K.’s FTSE 100 declined 0.89%, Germany’s DAX ended down 0.96% and France’s CAC 40 shed 0.91%, while Switzerland’s SMI edged down marginally.
Among other markets in Europe, Austria, Belgium, Finland, Ireland, Poland, Spain, Sweden and Turkey ended notably lower.
Czech Republic, Denmark, Netherlands and Portugal also closed weak. Greece and Iceland drifted lower, while Norway and Russia ended flat.
In the UK market, Antofagasta, Ocado Group, BP, Evraz, British Land Company, Melrose Industries, Barclays Group, Glencore, Land Securities, Associated British Foods, Lloyds Banking Group, Natwest Group, BHP Group and Royal Dutch Shell lost 2 to 5%.
Informa, Segro, United Utilities, Avast, Aveva Group, Relx, Tesco and Auto Trader Group closed notably higher.
In the German market, Continental, Daimler, BMW, Volkswagen, Covestro, Deutsche Bank and BASF lost 2 to 4.2%. Vonovia, Lufthansa, Merck and SAP gained 1 to 1.5%.
In France, ArcelorMittal, Technip and Renault lost more than 5%. Faurecia, BNP Paribas, Societe Generale and Credit Agricole ended lower by 3 to 4%.
Shares of French speed-train maker Alstom ended more than 8% down after the company forecast negative free cash flow in the first half of the financial year 2021-2022 due to the integration of newly-acquired Bombardier Transportation.
Suez, Valeo, Airbus Group, Air France-KLM, Michelin and Safran also ended sharply lower, while Dassault Systemes and WorldLine closed on a strong note.
In economic news, data from Destatis showed German manufacturing orders dropped 3.7% month-on-month in May, reversing a 1.2% rise in April. Orders were forecast to grow 1%.
Economic expectations declined in Germany for a second straight month but held up at the historic high levels, the ZEW economic research institute said. The corresponding index decreased to 63.3 from 79.8 previous.
Germany’s construction sector contracted again in June as supply bottlenecks weighed on production and new orders, survey results from IHS Markit showed. The headline construction Purchasing Managers’ Index rose to 47.0 in June from 44.5 in May. However, a score below 50 indicates contraction.
Euro zone monthly retail sales rose more than expected in May after a drop in April. Eurostat said the volume of retail sales rose 4.6%, reversing a 3.9% fall in April. Economists had expected retail sales to rise 4.4%.
A survey showed U.K. construction industry recorded its fastest growth in 24 years last month, helped by a jump in demand for new homes and commercial property.
Market Analysis
European Stocks Close Lower On Weak Data, Oil’s Retreat
2021-07-06 18:13:57
