Europe open: Shares shrug off Brexit, US stimulus worries

European shares rose on Friday as investors shrugged off continuing Brexit worries and more horse trading over a US stimulus package.

The pan-European STOXX 600 index was up 0.33%, with the UK’s FTSE 100 up 0.66% and France’s CAC 40 0.5% higher, while Germany’s DAX was flat. US Dow Jones futures were up 100 points.

Sentiment was dampened overnight after Pfizer halved its projected Covid 19 vaccine rollout, due to delays in scaling up its supply chain. It said it would was only likely to deliver 50m doses of the treatment.

Project partner BioNtech saw its shares down 3% on the news, which came as the US reported a record number of Covid-19 daily deaths, with the possibility of a full lockdown in California.

Investors were also eyeing non-farm payroll figures later on Friday, with consensus of 470,000 jobs added in November, compared to the October’s 638,000.

The rising number of US deaths from the pandemic also threw haggling over a financial relief package into sharp focus.

“With US policymakers once again engaged in discussions over a possible stimulus deal, markets are once again being buffeted by headlines about the restarting of talks between US Treasury Secretary Steve Mnuchin, House leader Nancy Pelosi, and Senate majority leader Mitch McConnell,” said CMC Markets analyst Michael Hewson.

“A bipartisan proposal of a $908bn stimulus package does appear to have much broader support given recent increases in weekly jobless claims, however the prospect of a deal is still some way away.

“It is important not to underestimate how important these talks are given that in the absence of a deal by year end 12m Americans will lose their unemployment benefits, with all of the attendant risks that could spell for the US economy.”

In the UK, fears of a no-deal Brexit grew as both sides refused to yield over fishing rights and future governance.

In economic news, German October industrial orders rose more than expected month on month.

On the equity front, Berkeley Group shares were down 3.3% as the housebuilder stuck to its targets for shareholder returns but reported a 16.6% fall in first-half profit caused by the Covid-19 crisis. Peers followed suit, with Taylor Wimpey, Barratt and Persimmon all trading lower.

Associated British Foods fell after a trading update on the recent lockdown in November revealed estimated sales losses of £430m at Primark.

SSE gained after saying it had sold a 10% stake in the first two phases of Dogger Bank Wind Farm to Eni for £202.5m as it lifted guidance for the 2020/21 fiscal year.