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European Stocks Edge Higher; Continuing Rally on Omicron Optimism

Stock MarketsDec 08, 2021 03:38AM ET
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© Reuters.

By Peter Nurse 

Investing.com - European stock markets posted small gains Wednesday, adding to the recent sharp rally driven by hopes that the Omicron Covid-19 variant is less virulent than previous versions.

At 3:35 AM ET (0835 GMT), the DAX in Germany traded 0.1% higher, the CAC 40 in France rose 0.5% and the U.K.’s FTSE 100 climbed 0.5%. 

A South African study suggested on Tuesday that booster doses produced by Pfizer (NYSE:PFE), and German partner BioNTech (NASDAQ:BNTX), could help fend off infection from Omicron, although the study showed the new strain can partially evade protection from two doses. BioNTech stock fell 0.7%.

An earlier study showed that GlaxoSmithKline's (LON:GSK) antibody-based therapy, made in conjunction with Vir Biotechnology (NASDAQ:VIR), was effective against it.

Still, whatever the news surrounding Omicron, the countries in Europe are still battling to stop a fourth wave of the pandemic, with Germany recording the highest number of deaths from Covid-19 since February on Wednesday.

Wednesday also sees the end of an era in Germany as Olaf Scholz is sworn in as chancellor, replacing Angela Merkel. 

In corporate news, L’Oreal (PA:OREP) stock rose 1.2% and Nestle (SIX:NESN) rose 1.7%, after the world’s largest food company said late Tuesday it would cut its stake in the French cosmetics company to about 20%, reducing its holding for the first time in seven years.

L’Oreal said the deal will have an accretive effect on the company's earnings per share of more than 4% in a full year.

Tui (DE:TUIGn) stock fell 2.8% after the tour operator posted an annual loss of over 2 billion euros ($2.26 billion) and warned that the news around Omicron had slowed bookings, while HelloFresh stock slumped 6.9% as the meal-kit provider offered up underwhelming 2022 guidance.

Umicore (BS:UMIb) stock fell 5.1% after the Belgian chemicals and recycling company announced plans to establish a battery materials venture to supply Volkswagen (DE:VOWG_p), as the German carmaker expands its electric vehicle output. VW stock was up 1.6%, continuing its advance on the back of a German newspaper report that the controlling Porsche/Piech family may spin off its luxury Porsche brand to help finance the shift to e-mobility.

Crude prices edged lower Wednesday, consolidating after two days of strong gains, as investors reprice the threat posed to global oil demand by Omicron.

U.S. crude oil supply data from the American Petroleum Institute showed a draw of just over 3 million barrels last week, and investors now await crude oil supply data from the U.S. Energy Information Administration later in the day for confirmation.

By 2 AM ET, U.S. crude futures traded 0.8% lower at $71.50 a barrel, while the Brent contract fell 0.6% to $74.97. Both benchmarks posted gains of just under 5% on Monday and over 3% on Tuesday.

Additionally, gold futures rose 0.2% to $1,787.85/oz, while EUR/USD traded 0.2% higher at 1.1285.

 

European Stocks Edge Higher; Continuing Rally on Omicron Optimism
 

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Comments (3)
David Vaughan
David Vaughan Dec 08, 2021 6:24AM ET
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Bad news is good news and good news is great news
Fab De
Fab___De Dec 08, 2021 6:24AM ET
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Again wrong 'news'
Meru Pet
Meru Pet Dec 08, 2021 5:46AM ET
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not sure...
 
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