European stocks rose to start the week on Monday, with investors inspired by countries reopening from pandemic closures and a positive survey of business sentiment from Germany.
But the trade was thinner in terms of holidays in the UK and the US.
The Stoxx Europe 600 Index
up 0.8% to 342.87, after winning 3.6% last week. It marked the best weekly return since the week ending April 9. French CAC 40 index
received 1.1% and FTSE MIB Italy
increased 0.8%. The UK’s markets will remain closed on Monday for a Spring Bank holiday.
The German DAX
jumped 1.6% after the German business sentiment came in stronger than expected for May after a “catastrophic few months”, says the Ifo Institute. The gradual easing of the lockdown “offers a glimpse of hope” for business, said Clemens Fuest, Ifo president.
Ahead of these figures, a 2.2% slowdown in German growth during the first quarter, which marked the largest decline since the financial crisis, pushed the economy to a recession. It was followed Later in the morning, the German business sentiment rose in May, beating forecasts when business expectations improved significantly, the Ifo Institute said on Monday.
Investors are keeping an eye on rising US-China tensions and raising concerns in Hong Kong, but remain “somewhat optimistic about the reopening of companies worldwide and hope for more monetary and fiscal stimulus,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank, in a note to customers.
Hong Kong police fired water cannons and tear gas at protesters in a popular shopping district on Sunday, while thousands mounted street protests against China’s plan to move to enforce national security legislation on the city. Signs of new tensions in the region add frictions built between the US and China over the coronavirus pandemic.
Council national security adviser Robert O’Brien said on Sunday that the United States is likely to sanction China if that legislation is passed. For its part, China has warned of strained relations between the two countries.
“We need to pay attention to efforts by some political forces in America to cut China-US relations and try to push the two countries towards a so-called ‘new Cold War’,” Chinese Foreign Minister Wang Yi said in comments on Sunday, according to reports in the South China Morning Post and elsewhere.
In Europe, investors were greeted by news that large European countries are slowly resuming from closures. Churches in France reopened to the Sunday Mass for the first time in two months, while Spain said it would reopen for international tourists from July and Germany and Italy are also slowly opening their economy.
In the United Kingdom, Prime Minister Boris Johnson has come under fire for standing by Chief Assistant Dominic Cummings, who drove 250 miles from London to Durham to his parents while infected with coronavirus.
Pharmaceutical stock was on Monday with shares of heavily weighted Bayer AG
to gain 4.5% after Bloomberg reported that the company has reached deals with 50,000 to 85,000 US cancer cases affiliated with its herbicide Roundup. These quoted sources said that none of the offers have yet been signed.
Shares of Novo Nordisk AS
fell 1.6% while the car manufacturer BMW AG
fell almost 2%.
was among the heavyweight amplifiers, up 1.6%.
US stock futures
traded higher, even though Wall Street remains closed on Monday for Memorial Day.