Oct 22, 2020

European Markets Closing Report: European markets close lower with U.S. stimulus, consumer data and earnings in focus


Elliot Smith, Holly Ellyatt

LONDON — European stocks closed slightly lower on Thursday as investors digested uncertainty over U.S. coronavirus stimulus, new consumer data and a raft of corporate earnings.

.FTSEFTSE 100FTSE5794.3517.850.31437528325
.FCHICAC 40 IndexCAC4857.853.900.0862970163

The pan-European Stoxx 600 provisionally closed down by around 0.2%, with most major bourses in negative territory. Sectors showed a more mixed picture, with tech stocks shedding 1.1% while travel and leisure shares gained 1.5%.

On the data front, German consumer confidence has ebbed with GfK’s forward-looking index for November coming in at -3.1 points, down from 1.7 points in October. Later in the session, a flash estimate from the European Commission showed euro zone consumer confidence falling 1.6 points in October, to -15.5.

U.S. stimulus talks remain in focus for global markets with uncertainty over whether a deal can be reached before the Nov. 3 presidential election. However, comments on stimulus talks from House Speaker Nancy Pelosi’s deputy chief of staff, Drew Hammill, offered some room for optimism Wednesday.

“The Speaker & Secretary Mnuchin spoke today at 2:30 pm for 48 minutes. Today’s conversation brings us closer to being able to put pen to paper to write legislation,” Hammill wrote on Twitter just after the closing bell on Wall Street.

On Wall Street, the major stock indexes were mixed as traders weighed the latest developments surrounding stimulus negotiations. Investors also monitored a warning from U.S. officials that Iran and Russia are trying to interfere in the U.S. presidential election.

On the data front, weekly jobless claims fell to 787,000 for the week ending Oct. 17, marking the first time since March that claims come in below 800,000.

Earnings in focus

Corporate earnings are a key driver of individual share price action Thursday. British Airways parent IAG reversed course to climb almost 5% by the close, having fallen more than 5% at the start of the session after posting a 1.3 billion euro ($1.5 billion) loss for the third quarter and cutting its schedule.

Dassault Systemes shares fell 2.1% despite the French software maker posting a slight annual rise in third-quarter net profit.

At the bottom of the Stoxx 600, British price comparison site Moneysupermarket.com plunged nearly 10% after reporting a sharp drop in revenues in the third quarter.

German automotive battery manufacturer Varta fell almost 8% after announcing that it had extended its contract with CEO Herbert Schein until 2026.

At the top of the European blue chip index, Swedish investment company Lifco surged 12% after a strong third-quarter earnings report.

— CNBC.com staff contributed to this report.

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