European Shares Falter As US-China Tensions Rise

(RTTNews) - European stocks tumbled on Friday as worries about rising Covid-19 cases and a sharp escalation in tensions between the United States and China overshadowed a slew of upbeat economic data from the region.

Just days after the U.S. government ordered China to close its consulate in Houston, Texas, China announced the closure of the U.S. consulate in Chengdu, saying it was a "legitimate and necessary response to the unreasonable actions of the United States."

The pan European Stoxx 600 fell 1.7 percent to 367.37 after closing up 0.1 percent on Thursday. The German DAX lost 1.8 percent, France's CAC 40 index gave up 1.6 percent and the U.K.'s FTSE 100 was down 1.4 percent.

Technology stocks followed their U.S. peers lower, with SAP, Infineon Technologies and Dialog Semiconductor losing 4-5 percent.

Dassault Aviation tumbled 3.7 percent after its net income for the first half of 2020 dropped to 32.00 million euros from 253.7 million euros in the prior year.

Thales declined 2.6 percent as it set new financial guidance based on a stabilizing economy and health situation, after taking into account continuing disruptions in the civil aeronautics market.

British education firm Pearson tumbled almost 4 percent after posting a first-half loss.

British Gas owner Centrica surged 18 percent after it announced a deal to sell its North American business Direct Energy to NRG Energy for $3.63 billion.

Vodafone shares plunged 4.7 percent. After reporting a slight fall in first-quarter revenue, the company said its mobile towers business will be spun-off via an initial public offer in Frankfurt early next year.

Signify NV, the world's biggest lighting maker, soared 4.6 percent after reporting a 62 percent increase in second-quarter net profit.

In economic releases, the euro area private sector grew at the fastest pace in just over two years in July due to the relaxation of the coronavirus containment measures, flash survey data from IHS Markit showed.

The composite output index rose to a 25-month high of 54.8 from 48.5 in June. This was above economists' forecast of 51.1.

The U.K. manufacturing and services purchasing managers' indexes both rose in July, according to initial 'flash' readings from IHS Markit.

A measure of U.K. consumer confidence remained unchanged at lower level in July, final data from market research group GfK showed, with the corresponding index coming in at -27 in July, unchanged from flash estimate but above from June's score of -30.

U.K. retail sales volume advanced 13.9 percent month on month in June, faster than the 12.3 percent rise in May and bigger than economists' forecast of 8 percent.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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