By Peter Nurse
Investing.com - The U.K. stock market pushed lower Friday, in thin trading with most of Europe on holiday, following weakness on Wall Street amid talk of further trade disputes.
At 3:12 AM ET (0735 GMT), the U.K.'s FTSE index traded 125 points, or 2.1% lower, while France's CAC 40 and the DAX in Germany were both closed due to holidays.
Overnight, the Dow Jones Industrial Average finished 1.2% lower, the S&P 500 lost 0.9%, and the Nasdaq Composite shed 0.3%.
U.S. President Donald Trump ratcheted up Sino-U.S. tensions late Thursday, threatening new trade tariffs on Beijing amid retaliatory measures over the outbreak of the coronavirus, which he blames on China.
It was only in January that Trump signed a first phase of a multibillion-dollar trade deal with China, seeking to quell what had become a damaging trade war.
Another fight would likely limit global growth prospects, exactly what isn’t needed during these troubled times, and may push fragile economies in Europe further into recession.
The region’s recession is likely to be deep enough as it stands, according to European Central Bank President Christine Lagarde. She said Thursday that eurozone GDP could slump 15% in a “severe” scenario, which places the near 4% contraction in the first quarter firmly into the shade.
In corporate news, Ryanair (LON:RYA) was in focus after Europe’s largest low-cost airline said Friday it would ground more than 99% of its flights until July and that it had begun negotiations with Boeing (NYSE:BA) about cutting the number of aircraft deliveries over the next 24 months. Ryanair shares dropped 3.8%.
Shares in J Sainsbury (LON:SBRY) fell 1% after the U.K. retailer said late Thursday that it expects to take a £500 million ($628 million) hit to annual profits due to the cost of keeping open during the pandemic, and it may have to close some stores if the situation worsens.
Economic data were thin on the ground in Europe Friday, with the standout number being the U.K. manufacturing PMI for April, at 04:30 AM ET (0830 GMT), which is expected to show a sharp contraction in the sector.
Oil futures pushed higher Friday, extending the previous session's gains, as major producers began output cuts to offset a slump in fuel demand triggered by the coronavirus pandemic.
At 3:12 AM ET, U.S. crude June futures traded 1.7% higher at $19.16 a barrel. The international benchmark Brent contract was flat at $26.48
Elsewhere, gold futures fell 0.6% to $1,684.05/oz, while EUR/USD traded at 1.0965, up 0.1%.