Europe open: Stocks rally after Thursday selloff
European stocks rallied in the final session of the week after Thursday’s selloff that saw shares fall by almost 2%.
The pan-European Stoxx 600 index was up 0.61% despite falls in Asia overnight as fears persisted over the rising number of Covid cases.
“Investors looking for negatives will sometimes find them and the current lack of conviction is weighing on markets generally,” said Interactive Investor head of markets Richard Hunter.
“A move towards haven assets such as bonds has further depressed yields, suggesting that some believe that lower economic growth is on the horizon. This is largely driven by the dual concerns of the impact of the Covid-19 variant in some populous areas of the globe, alongside the inevitable Federal Reserve tapering of bond buying.”
In the UK, official data showed May GDP grew by a lower-than-expected 0.8% from a revised 2% in April, coming in well below expectations for 1.5% growth. April’s figure was revised down from 2.3%.
This marked the fourth consecutive month of growth and leaves the economy 3.1% below where it was in February 2020, before the Covid-19 pandemic hit.
The services sector was the biggest contributor, with growth of 0.9%, after indoor hospitality was allowed to reopen in May. Accommodation and food service activities grew by 37.1%.
In equity news, British Airways-owner IAG, easyJet and Ryanair all rose as the UK planned to scrap quarantine for fully-vaccinated arrivals from other countries in the coming weeks.
French aircraft maker Airbus gained after it reported a 52% jump in deliveries in the first half of the year.
British luxury goods group Burberry rose 3% after Goldman Sachs upgraded the stock to “buy”, while Italian rival Salvatore Ferragamo slipped after the US bank downgraded it to “sell”.