European stock markets traded higher Wednesday
2022.07.06 11:46
European stock markets traded higher Wednesday, rebounding strongly with investors seeking bargains after the previous session’s slump on increasing recession fears.
By 04:20 AM ET (0820 GMT), the DAX in Germany traded 1.5% higher, the CAC 40 in France rose 1.7%, and the UK’s FTSE 100 gained 1.8%.
Helping the tone Wednesday was the news that new orders to German manufacturers rose for the first time in four months in May, breaking a losing streak that had begun immediately after Russia’s invasion of Ukraine.
Statistics office Destatis said orders edged up 0.1% from April, while it also revised up April’s numbers to show a decline of only 1.8% from an initial estimate of 2.7%.
The number, which is an important leading indicator for the Eurozone economy, helped overcome some of the pessimism generated by Tuesday’s publication of S&P GIobal’s composite purchasing managers index for the single currency bloc, which registered its lowest reading in 16 months.
Eyes will now be on the release of the Eurozone retail sales data for May later in the session as investors try and judge the impact on the region’s consumers of the rampant inflation.
The region’s main equity indices closed with hefty losses on Tuesday after fresh survey data showed the Eurozone economy edging closer toward contraction. Adding to the negative sentiment was talk of gas rationing in Europe, a political crisis in Britain, and a fresh flare-up of COVID-19 cases prompting fresh restrictions in Shanghai.
On the corporate front, Just Eat Takeaway (AS:TKWY) stock soared by more than 16% after the online delivery service unveiled a new partnership with Amazon (NASDAQ:AMZN) that will see the tech giant take a stake in its Grubhub unit.
Trainline (LON:TRNT) stock rose over 20% as a sharp rebound in tourism in the spring led the company, which specializes in online ticket sales for train travel across Europe, to raise its guidance.
On the flip side, Uniper (ETR:UN01) stock fell 4.6% after the German gas giant continued bailout talks with the German government in the midst of a continent-wide energy crisis.
Oil prices traded higher Wednesday, bouncing back from the previous session’s rout with the focus on supply tightness.
The secretary general of oil producers group OPEC, Mohammad Barkindo, died late Tuesday, just hours after he stated that the industry faces some problems due to years of under-investment.
He had added that supply tightness could be eased if extra supplies from Iran and Venezuela were allowed, but additional supply from the Persian Gulf country looks unlikely near term after it rejected a plan to return to the 2015 international nuclear accord.
By 04:20 AM ET, U.S. crude futures traded 1.2% higher at $100.69 a barrel, after closing below $100 for the first time since late April, while the Brent contract rose 1.7% to $104.56, after plunging 9.5% on Tuesday, the biggest daily drop since March.
Additionally, gold futures rose 0.3% to $1,769.60/oz, while EUR/USD traded 0.1% lower at 1.0259.
