(Reuters) – European stocks ended flat on Monday, disappointing Chinese data and caution over the spread of a COVID-19 variant outweighing optimism about the UK economy reopening, while that Swedish Kinnevik jumped up and was the most successful.
The pan-European STOXX 600 index finished flat, with travel and leisure stocks the biggest losers, down 2.3%, while telecoms stocks surged the most, driven by gains in the Spanish telecommunications company Telefonica. in April and retail sales fell far short of expectations as officials warned of new issues affecting the economic recovery.
Meanwhile, new restrictions across Asia following a new wave of COVID-19 cases and concerns over the spread of a rapidly spreading coronavirus variant first identified in India have eclipsed optimism about the UK’s economic reopening.
“Airlines are on the sidelines again today with optimism about reopening international travel proving to be short-lived given concerns over the growth of India’s COVID variant,” said Joshua Mahony, senior analyst market at IG.
“Unfortunately, the risks posed by this latest strain also raise questions around these same companies which have just found a reprieve from the lockdown restrictions, with pub and restaurant chains all in retreat despite the resumption of dining room” Mahony added.
The UK mid-cap index focused on the domestic market fell 0.6%, with SSP Group and airlines Easyjet and Wizz Air Holdings the main drag. Irish airline Ryanair fell 2.8% after reporting a record annual after-tax loss as there were signs the recovery had started. European stocks have performed well so far and hit all-time highs this month, with the STOXX 600 rising nearly 11% so far this year as prospects for an economic recovery and strong earnings have attracted buyers of shares.
The European Union has agreed to a partial truce with the United States in a dispute over metals tariffs imposed by former President Donald Trump and has started talks on global overcapacity and “trade-distorting” policies. China. Mining stocks advanced 0.9%.
In business news, Sweden’s Kinnevik climbed 8.5% to the top of the STOXX 600 after the company transferred its stake in online fashion retailer Zalando to shareholders.
Spanish telecoms group Telefonica gained 3.5% as it sought buyers for its logistics and express delivery unit Zeleris, a source close to the offer said on Monday, amid a multi-month boom. in business as COVID-19 pushes people to shop online.
Drugmakers Sanofi and GlaxoSmithKline jumped 1% and 0.7% respectively after their investigational COVID-19 vaccine showed robust immune response in early-stage clinical trial results, allowing them to move into study advanced stage.
Reporting by Sruthi Shankar and Shashank Nayar in Bangalore; Edited by Subhranshu Sahu and Dan Grebler