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Saturday, May 21, 2022
Stocks & Shares

European stocks weaker as Covid cases rise

DAX

The DAX was 0.4% lower, the CAC 40 dropped 0.3% and the FTSE 100 shed 0.4%

Stock markets in Europe weakened Thursday on deteriorating German economic confidence as Covid cases continue to rise ahead of a key meeting of policymakers from the Federal Reserve and other central banks.

At 0800 GMT, the DAX in Germany was 0.4% lower, the CAC 40 in France dropped 0.3% and the U.K.’s FTSE 100 shed 0.4%.

The September German GfK consumer climate index declined to -1.2 earlier Thursday, dropping from a revised -0.4 for August, indicating that sentiment is weakening in Europe’s biggest economy.

On Wednesday, the Ifo Institute’s influential business climate index dropped for the second straight month, with German manufacturers complaining about supply constraints as well as fretting about rising Covid cases. According to data released on Wednesday, new cases in the country hit a three-month.

Adding to the concerns was news that the European Union (EU) could reimpose restrictions on visitors from the U.S. on Thursday, a move that would weigh heavily on the region’s travel and leisure sector. The EU is upset that the U.S. hasn’t reciprocated after Europe loosened restrictions on visiting U.S. tourists earlier in the summer.

European markets received a negative handover from Asia, after South Korea became the first major Asian economy to lift interest rates since the pandemic started.

In corporate news, DWS Group stock declined 9.4%, retreating from an all-time high, after the Wall Street Journal reported Wednesday that U.S. authorities are investigating Deutsche Bank’s asset management arm over claims it overstated how much it used sustainable investing criteria to manage its assets.

Barclays dropped 0.4% after the British lender announced Thursday that it will invest $400 million in its India unit to expand its operations in the country.

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