By Peter Nurse
Investing.com - European stock markets pushed higher Monday, with investors looking at the possibility of more stimulus as the new earnings season kicks off.
At 3:55 AM ET (0755 GMT), the DAX in Germany traded 1.1% higher, the CAC 40 in France rose 1% and the U.K.'s FTSE index was up 1.2%.
France will unveil “massive” support for youth employment this week and a new broad stimulus plan including tax cuts for companies at the end of August, Finance Minister Bruno Le Maire said Monday.
This comes ahead of Thursday’s European Central Bank meeting as well as the gathering of the 27 European Union leaders later this week to negotiate the seven-year EU budget and the creation of a 750 billion euro stimulus fund.
Earnings season for the second quarter gets underway this week. In the U.S., major banks, including Citigroup (NYSE:C), JPMorgan Chase (NYSE:JPM) and Wells Fargo (NYSE:WFC), are due to report by Friday, while in Europe, numbers from microchip equipment maker ASML (AS:ASML), miner Rio Tinto (NYSE:RIO) and telecom equipment firm Ericsson (BS:ERICAs) are also due.
Elsewhere, G4S (CSE:G4S) stock soared 8.5% after the security firm said its first-half earnings will be "significantly" above market expectations.
Novacyt (LON:NCYT) stock rose 2.4% after the company reported booming sales of its Covid-19 test.
Credit Suisse (SIX:CSGN) stock gained 1.1% on a report that the Swiss banking giant could cut "hundreds" of jobs as part of a new savings program.
However, Ubisoft Entertainment (PA:UBIP) stock dropped 8.1% after the video games maker company announced a shakeup due to allegations of misconduct and inappropriate behavior. Boohoo (LON:BOOH) shares slumped 13% after Standard Life Aberdeen sold two thirds of its holding in the fast fashion retailer after what it said was an 'inadequate' response to claims that it used sweatshop labor in its supply chain.
Helping Monday’s positive tone was the decision of Fitch rating agency late Friday to confirm Italy's credit rating, with a stable outlook.
However, the durability of this recovery has been put in doubt by the resurgence of the Covid-19 virus. The World Health Organization reported a record 230,370 new cases in 24 hours on Sunday, with the U.S. state of Florida reporting an increase of more than 15,000 new cases in 24 hours, a record for any state, surpassing the peak hit by New York in April.
Oil prices have drifted lower Monday, ahead of a meeting of OPEC’s technical staff on Tuesday and Wednesday, who are expected to recommend sticking to the timeline for restoring supply to the world market as demand recovers.
The group is due to restore 2 million of the 9.7 million barrels withheld from the end of July.
At 3:55 AM ET, U.S. crude futures traded 1.2% lower at $40.05 a barrel, while the international benchmark Brent contract fell 1.1% to $42.77.
Elsewhere, gold futures rose 0.4% to $1,808.65/oz, while EUR/USD traded at 1.1322, up 0.2%.