MILAN/FRANKFURT: European stocks slipped on Tuesday as losses in defensive sectors offset gains in oil and retail stocks, while investors looked past a new national lockdown in Britain to curb a surge in coronavirus cases.
The pan-European STOXX 600 index was down 0.2%, following losses in Asia and on Wall Street overnight over worries about Senate runoffs in the US state of Georgia.
UK’s FTSE 100 rose 0.3%, boosted by oil majors Royal Dutch Shell and BP, as crude prices inched higher with deadlocked talks between major producers about potential changes in February output set to continue.
The domestically focussed midcap index gained 0.6% as UK’s finance minister Rishi Sunak announced plans to support businesses struggling under a third COVID-19 lockdown.
Germany’s DAX index inched 0.2% lower with the government looking to extend a lockdown, while France’s CAC 40 slipped 0.3%.
Retailers were a bright spot, with Britain’s Next jumping 8.4% after it said its Christmas sales were much better than expected.
Shares in Marks and Spencer, Morrisons and Tesco rose between 0.9% and 2.9% after market researcher Kantar said British grocery sales hit a record high in December.
German chipmaker Dialog Semiconductor PLC gained 3.7% after it gave an upbeat fourth-quarter revenue forecast due to strong demand for 5G phones and tablets.
ASML rose 0.7% after analysts at RBC and Liberum raised their price targets on the stock.
“It doesn’t seem like restrictions have much of an impact as traders are fixated on the wider story that vaccines are being distributed and the world should be in a very different place in another two to four months,” said David Madden, analyst at CMC Markets.
European stocks rallied to fresh February highs on the first trading session in 2021 on Monday on hopes the vaccines will spur a speedy economic rebound.
The global mood dampened on Tuesday ahead of the Senate election outcome, which could have a big impact on incoming US President Joe Biden’s ability to pursue his preferred economic policies. Stocks considered as safe-havens like utilities, healthcare and food & beverage fell the most among European sectors.
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