This post was originally published on this site
https://i-invdn-com.investing.com/news/LYNXNPEEAC0LE_M.jpg
Investing.com – European stock markets traded sharply lower Tuesday, with the latest surge of Covid-19 cases on the continent weighing on sentiment as further lockdowns loom.
At 3:45 AM ET (0845 GMT), the DAX in Germany traded 1.3% lower, the CAC 40 in France also fell 1.3% and the U.K.’s FTSE 100 dropped 0.6%.
Austria reintroduced a national lockdown on Monday to combat a fresh surge in Covid-19 cases, and this has investors fretting that neighboring Germany, the main growth engine for the Eurozone, will shortly follow suit.
German Chancellor Angela Merkel called the situation worse than anything her country has experienced so far, while Health Minister Jens Spahn issued a blunt assessment of the situation the country faced.
“Some would say this is cynical but probably by the end of this winter, pretty much everyone in Germany will be vaccinated, recovered or dead … That’s the reality,” Spahn told a press conference in Berlin on Monday.
These fears have overshadowed stronger than expected flash PMI data for both Germany and France, suggesting businesses have continued to perform despite the recent surge of Covid cases.
The PMI release for the important German manufacturing sector, a key growth driver for the region, came in at 57.6, a small fall from the 57.8 level seen the previous month.
In the corporate sector, E.ON (DE:EONGn) stock fell 3.5% after Europe’s largest operator of energy networks said Tuesday it was planning to invest about 27 billion euros ($30 billion) in its core business by 2026 while preparing for a green future.
Compass (LON:CPG) stock fell 1.9% despite the catering giant resuming dividend payouts after reporting better-than-expected annual profit as economies reopened.
Market participants will also be digesting the decision by President Joe Biden to reappoint Jerome Powell as chairman of the Federal Reserve. This renomination now heads to the Senate for confirmation, but the tech-heavy Nasdaq Composite and the Treasury market closed sharply lower as investors wagered that he will be more aggressive at tackling inflation than his potential replacement, Fed Governor Lael Brainard, would have been.
Crude prices fell Tuesday on growing talk the U.S. will shortly announce a coordinated release of oil from strategic reserves in an attempt to cool elevated prices.
The United States is expected to announce a loan of crude oil from its emergency stockpile on Tuesday, Reuters reported, citing a Biden administration source familiar with the situation.
The likes of India, Japan, South Korea and China, the world’s biggest oil importer, are also expected to join in the release of additional output.
By 3:45 AM ET, U.S. crude futures traded 1.2% lower at $75.84 a barrel, while the Brent contract fell 0.8% to $79.05.
Additionally, gold futures fell 0.1% to $1,804.10/oz, while EUR/USD traded 0.2% higher at 1.1254.
