European stock markets posted strong gains Monday amid hopes of a world economic recovery, however concerns remain over the increasing number of recent coronavirus cases.
At 3:50 AM ET (0750 GMT), the DAX in Germany traded 2.1% higher, France’s CAC 40 rose 2%, the U.K.’s FTSE index was up 2.2%.
Economic data of late has tended to point to a reasonably prompt economic recovery around the world.
Earlier Monday, German factory orders jumped 10.4% in May, rebounding after falling by a revised 26.2% the previous month.
Allianz (DE:ALVG) senior economist Katherina Utermoehl said via Twitter that the data point to a “much more gradual recovery” than in retail, “due in particular to weak foreign demand.”
“BUT as deconfinement in key countries only started in May, June should have more oomph,” Utermoehl added.
This follows on from the U.S. recording the addition of 4.8 million jobs in June, much more than expected, while PMI data in China and throughout Europe have tended to counsel renewed confidence in a brisk pickup in activity.
Additionally, the U.S. Congress is ready to resume talks on the next stimulus bill later this month. The likely need for added stimulus grows as the number of Covid-19 cases shows no signs of slowing down. The World Health Organization reported the highest number of cases over a 24-hour period, with both Texas and Florida reporting new one-day records for new infections on Saturday.
Turning back to Europe, Boohoo (LON:BOOH) stock slumped 11% following a media report on the working conditions at one of its suppliers. The British online fashion retailer said on Monday it would terminate relationships with any supplier who was found not to be acting within its code of conduct.
Lloyds Banking (LON:LLOY) stock rose 2.7% after the British group’s CEO, Antonio Horta-Osorio, said he will step down at the end of next year. Rivals banks HSBC (LON:HSBA) rose 6% and standard chartered (OTC:SCBFF) 5%, benefitting from their links to Asia given the big equity rally in that part of the world.
Later in the session, the June construction PMI release from the U.K. will be published, as will eurozone retail sales for may.
Oil prices pushed higher Monday, although the continued growth of latest coronavirus cases in the U.S. resulted in underperformance by the american benchmark, WTI futures.
Coronavirus cases in the U.S. increased by virtually 56,000 on Sunday, according to Johns Hopkins University. raising concerns that this jump might hit oil demand in the united states.
At 3:50 AM ET, U.S. crude futures traded 0.8% higher at $40.98 a barrel. The international benchmark brent contract rose 1.8% to $43.55.
Elsewhere, gold futures fell 0.3% to $1,785.35/oz, whereas EUR/USD traded at 1.1297, up 0.4% on the day.
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