European stock markets shrug off rising COVID-19 cases across the continent

European Commission president Ursula von der Leyen has said Europe is at the start of the third wave of the pandemic. Photo: Aris OIkonomou/Reuters

European Commission president Ursula von der Leyen has said Europe is at the start of the third wave of the pandemic. Photo: Aris OIkonomou/Reuters

Stocks in Europe pushed higher on Friday despite an increase in COVID-19 cases across the continent.

In London, the FTSE 100 (^FTSE) closed 0.99% higher while the French CAC (^FCHI) gained 0.55% and the German DAX (^GDAXI) was 0.83% higher amid vaccine optimism.

On Thursday, European Commission (EC) president Ursula von der Leyen warned that the bloc was “at the start of the third wave of the pandemic.”

France extended their lockdown to three additional regions – the Nievre, Rhone and Aube areas – with the government announcing that the newest wave has a higher number of younger people being admitted to hospitals.

German chancellor Angela Merkel also signalled that she would be declaring France a “high-risk COVID area.”

Overnight, French president Macron said that new measures to contain the outbreak might be needed in the coming weeks, adding that “the next few weeks will be tough.”

In Poland, it was announced that nurseries and preschools would close, as the country reported a fresh record of 34,151 new cases.

Elsewhere, the Finnish government has submitted a proposal that would see temporary restrictions on movement in the worst-hit areas for 3 weeks, with people only able to leave their homes for essential reasons or outdoor recreation.

READ MORE: UK businesses call for more clarity on reopening plans

Michael Hewson, chief market analyst at CMC Markets UK, said: “It has been notable this week that for all the concerns about a slowdown in Europe and a delay to an economic reopening that any dips in European stocks have been fairly shallow ones.

“This suggests that for all of the concerns about valuations, in Europe at least the appetite for stocks is still there, despite the uncertainty around rising infection rates and the slow rollout of vaccines.”

Across the pond, the S&P 500 (^GSPC) rose 0.79% and the tech-heavy Nasdaq (^IXIC) jumped 0.51%. The Dow Jones (^DJI) edged 0.66% higher at the time of the European close.

It followed Thursday’s rally as the S&P advanced and small-caps rallied as president Joe Biden doubled his vaccination target.

US banks also extended gains in after-hours trading as the Federal Reserve signalled an end to pandemic-era dividend curbs.

Ten-year US Treasury yields rose slightly after another lackluster auction of seven-year notes. The reaction was muted compared with the upheaval in bonds and interest-rate sensitive stocks following poor demand at last month’s sale. The dollar dipped but remained on track for its best week in almost a month.

WATCH: European stock markets shrug off rising Covid-19 cases

Asian stocks rose overnight, tracking US peers as vaccine distribution bolstered economic optimism despite a climb in global COVID-19 cases.

A regional share gauge added more than 1%, led by Chinese and Japanese stocks.

The Japanese Nikkei (^N225) climbed 1.56% while the Hang Seng (^HSI) rose 1.6%. The Shanghai Composite (000001.SS) also jumped 1.63%.

Oil (BZ=F) rebounded slightly from its losses this week as global companies have begun rerouting cargo away from the Suez Canal as the grounded Ever Given ship blocking the route is estimated to take weeks to free up.

On Friday, seven tankers carrying liquefied natural gas (LNG) were diverted as the crisis enters a fourth day. Data intelligence firm Kpler said that three of the tankers were being diverted towards the longer route around Africa, via the Cape of Good Hope.

READ MORE: Firms start rerouting vessels as ship blocking Suez Canal could take weeks to free

The majority of the diverted tankers, which were originally destined for Suez canal were now headed elsewhere, according to Kpler.

“A total of 16 LNG vessels’ planned transit via the Suez Canal will be affected if the congestion persists until the end of this week,” Kpler analyst Rebecca Chia said.

She added: “There will be considerable delays in the loading schedule at Ras Laffan for the start of April due to the congestion.”

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