European Markets Close Notably Higher On Recovery Hopes

(RTTNews) - European markets closed higher on Tuesday as reassurance from the U.S. about the phase one trade deal with China, and better than expected batch of economic data from the euro area helped offset concerns about the spread of coronavirus infections in the U.S. and several other parts across the world.

Markets also reacted positively to an announcement from British Prime Minister Brian Johnson about relaxation of lockdown restrictions and reopening of bars, restaurants and cinemas from early July.

The pan European Stoxx 600 moved up 1.3%. Among the major indices, Germany's DAX advanced 2.13%, while the U.K.'s FTSE 100 and France's CAC 40 gained 1.21% and 1.39%, respectively. Switzerland's SMI added 0.94%.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Finland, Greece, Ireland, Netherlands, Norway, Poland, Portugal, Russia, Spain and Sweden all ended on a firm note, gaining between 0.6 to 2%. Turkey edged up marginally.

In the U.K. market, Evraz spurted more than 8%. Standard Life gained 6%, while Fresnillo, M&G, Kingfisher, Glencore, Lloyds Banking and Anglo American moved up 3 to 4.6%.

BHP Group, Prudential, Royal Dutch Shell, Polymetal International, Royal Bank, DS Smith, Melrone, Phoenix Group Holdings, Berkeley Group, Antofagasta, Aviva and Rio Tinto also rose sharply.

On the other hand, Hikma Pharmaceutical surged up 5.8% after Boehringer Ingelheim sold its stake in the British pharmaceutical company. Rightmove, TUI and Ocado Group declined 3.4 to 3.8%.

In the German market, Wirecard shares soared more than 19% after recent heavy losses amid an ongoing accounting scandal.

Bayer gained about 6.5%. Volkswagen, Covestro, Fresenius, Adidas, Deutsche Post, Deutsche Bank, BASF, Infineon Technologies, Deutsche Telekom, Allianz, Thyssenkrupp, Fresenius Medical Care and Munich RE gained 2 to 4.5%, while Lufthansa declined by about 3.8%.

In France, Peugeot rallied 7.7% and Renault gained 6.75%. ArcelorMittal, Societe Generale, Valeo, Credit Agricole, Bouygues, BNP Paribas, Michelin, STMicroElectronics, Publicis Groupe and Technip ended higher by 2.7 to 5%.

In economic news, survey results from IHS Markit showed the euro area private sector contracted at a slower pace in June as lockdowns to prevent the spread of the coronavirus disease outbreak were further relaxed. The flash composite output index advanced more-than-expected to 47.5 from 31.9 in May. The score was forecast to rise to 42.4.

Output decreased again in both manufacturing and services, the latter showing the slightly steeper rate of decline. The services Purchasing Managers' Index climbed to 47.3 from 30.5 in the previous month. This was also above economists' forecast of 41.0. The factory PMI rose to 46.9 in June from 39.4 in May. The expected level was 44.5.

Germany's private sector showed signs of a turnaround in June, flash data from IHS Markit showed. The flash composite output index climbed to 45.8 in June from 32.3 in the previous month. This was the highest reading in four months and above economists' forecast of 44.2.

The manufacturing Purchasing Managers' Index advanced to 44.6 from 36.6 a month ago. The expected level was 41.5. Meanwhile, the services PMI came in at 45.8 versus 32.6 in the previous month and well above forecast of 42.0.

France's private sector expanded for the first time in four months in June as restrictions related to dealing with the covid-19 pandemic continued to be lifted, report from IHS showed. The composite output index rose to a four-month high of 51.3 from 32.1 in May. The reading was also above economists' forecast of 46.3. A score above 50 indicates expansion.

The manufacturing Purchasing Managers' Index advanced to 52.1 in June from 40.6 in May, and the services PMI came in at 50.3 versus 31.1 a month ago, both beating expectations by big margins.

Meanwhile, the the downturn in the UK private sector also slowed in June after the record weakness seen during the height of the coronavirus lockdown, flash survey data from IHS Markit showed Tuesday. The IHS Markit/Chartered Institute of Procurement & Supply composite output index rose to 47.6 in June from 30.0 in May. The reading was above economists' forecast of 41.0.