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Europe: Shares edge higher after torrid week of losses
[BENGALURU] European shares closed slightly up on Friday after heavy losses in the previous session, but marked their worst week since the peak of the coronavirus sell-off due to persistent concerns over the pace of an economic recovery.
The pan-European Stoxx 600 index ended 0.3 per cent higher, after clocking its worst single-day loss since March 23 in the previous session.
The index has lost about 5.7 per cent for the week, with travel and leisure stocks the worst performers as fears of a second wave of coronavirus infections in the United States rattled sentiment.
Markets had come off three-month highs through the week, with the sell-off intensifying on Thursday after the US Federal Reserve pointed to a long road to economic recovery for the world's largest economy.
"You have run up for so long, the market is looking for an excuse to pause," said Neela Gollapudi, head of portfolio management and research at GenTrust.
"Fed's Powell said we are not going to have a V-shaped recovery, and the markets were priced to perfection in terms of how quickly things are going to turn around."
On the day, battered shares of automakers, basic resources and real estate companies rose between 1.4 per cent and 2 per cent.
Royal Dutch Shell, BP and Total rose between around 0.6 per cent and 1.7 per cent, despite a drop in oil prices.
Data also showed that euro zone industrial output fell the most on record in April as lockdowns halted activity across the region, with analysts pointing to an arduous recovery for the sector.
"As restrictions on industry have been gradually lifted since late April, expectations are that May will be the start of a drawn-out recovery of output," wrote Bert Colijn, Senior Economist, Eurozone, at ING. "It could be a long road ahead before industry reaches output seen at the start of 2020."
Italian stocks rose 0.4 per cent on the day. Italian Economy Minister Roberto Gualtieri said on Friday that the country's economic contraction this year may be slightly worse than the 8 per cent decline currently forecast by the government.
France's Interparfums surged 13.3 per cent after Italy's Moncler entered an agreement with the company to start selling perfumes.
Italian infrastructure group Atlantia gained 3.9 per cent as said it hoped for a positive solution to its row with the transport ministry over its motorway concession. The company swung to a net loss in the first quarter.