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Investing.com – European stock markets edged higher Friday, with investors looking for more stimulus to help the region’s nascent recovery amid concerns about a fresh spike of Covid-19 infections.
At 4:15 AM ET (0815 GMT), the DAX in Germany traded 0.5% higher, France’s CAC 40 rose 0.5%, the U.K.’s FTSE index was up 0.4%.
EU leaders are set to discuss later Friday, via video conference, the European Commission’s plan to borrow 750 billion euros against the EU budget, in order to fund a recovery fund for the region.
Deep divisions remain over the plan with hard-hit countries such as Spain and Italy pushing for funds, while the so-called “frugal four”, including Denmark and Austria, are opposed to the fact much of that money would be earmarked as grants.
“We still think the frugal four will eventually bend in compromise, but with some compromises with budget rebates etc,” said Danske Bank, in a research note.
U.K. retail sales jumped 12% in May, after slumping 18% the previous month, in a welcome sign that the British consumer may be returning. At the same time, German producer prices remained in negative territory in May, providing food for thought for the European Central Bank given its inflation mandate.
While hopes for more stimulus to boost the global economy and thus a reasonably quick rebound remain strong, worries about a second wave of the Covid-19 virus have prompted some investors to temper their optimism this week.
On Thursday around 400 workers at a slaughterhouse in northern Germany tested positive for the virus. At the same time, cases have been rising in a number of the more populous U.S. states, while Beijing has struggled to cope with an outbreak which started at a popular food market over the weekend.
In corporate news, Lufthansa (DE:LHAG) stock climbed 2% amid hopes for some movement over its stalled government bailout.
Dutch bank ING (AS:INGA) stock rose 0.7% after promoting its chief risk officer Stephen van Rijswijk to be its new chief executive. He’ll succeed Ralph Hamers, who has moved to become CEO at UBS Group.
BMW (DE:BMWG)stock rose 0.4% after agreeing to a compensation package with employee representatives to allow job reductions.
Wirecard (DE:WDIG) stock tumbled another 40%, extending Thursday’s declines when the German payments processor said its auditor could not locate a hefty sum of cash on its balance sheet.
Oil prices pushed higher Friday, helped by Iraq and Kazakhstan, two of the countries who have struggled to meet their target cuts, agreeing to compensate for their overproduction in May.
This would take extra barrels out of the global supply, if followed through, and allay concerns of oversupply in the market.
At 4:15 AM ET, U.S. crude futures traded 2% higher at $39.95 a barrel. The international benchmark Brent contract rose 2.5% to $42.55.
Elsewhere, gold futures rose 0.4% to $1,737.55/oz, while EUR/USD traded at 1.1205, up 0.1%.
