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Investors took a pause Friday after a recent selloff sparked by fears that a pandemic comeback may stymie a global economic recovery, with European markets rising alongside U.S. stocks as bond yields leveled. Following a 1.7 percent dip on Thursday, the Stoxx Europe 600 index SXXP, +1.19 percent rose 0.7 percent to 454.69. The German DAX DAX, +1.54 percent climbed 0.9 percent, the French CAC 40 PX1, +1.98 percent gained 1.6 percent, and the FTSE 100 UKX, +0.94 percent gained 0.4 percent.

Following Thursday’s session in which all three indexes posted their worst daily percentage drops since June 18 over concerns that the global economy recovery could be stymied by resurgent COVID-19 cases in some counts, U.S. stocks SPX, +0.79% DJIA, +1.11 percent opened higher, though the Nasdaq Composite COMP, +0.43 percent was barely higher. Concerns over a slower recovery and waning expectations of high inflation pushed bond yields down sharply, with the 10-year U.S. Treasury yield TMUBMUSD10Y, 1.344 percent hitting 1.25 percent at one point on Thursday, its lowest level since February. On Friday, though, the yield had risen to roughly 1.34 percent. Concerns that a COVID-19 outbreak could spread during the Olympics prompted Japan to announce a state of emergency in Tokyo, which would last until the end of the Games. Cases are on the rise in regions of the United States and Europe, with the United Kingdom and Portugal in particular grappling with a surge of cases caused by the coronavirus delta strain. On Sunday, the Euro 2020 final will be played between Italy and England. The England-Denmark semifinal was watched by almost 60,000 people in the United Kingdom earlier this week. Italy is also expected to fly in 1,000 fans on Sunday who will be separated in the stands and forced to quarantine upon their return. On Friday and Saturday, G-20 finance ministers and central bank governors will gather in Venice, Italy, to debate tax reform and recovery progress in the wake of the epidemic. The UK economy slowed in May after a high surge in April as coronavirus restrictions were removed and the economy received a boost, according to data released on Friday. The Office for National Statistics reported that gross domestic product climbed 0.8 percent month over month, fueled by services. From a previous estimate of 2.3 percent, April’s growth was cut down to 2%. Banks and pharmaceutical companies led the advances in Europe, with BNP Paribas BNP, +1.82 percent shares up 2%, Novartis NVS, +0.43 percent NOVN, +0.87 percent shares up 1.8 percent, and Roche Holding ROG, -0.45 percent shares up 0.8 percent. Luxury goods companies were on the upswing, with LVMH Mot Hennessy Louis Vuitton LVMH, +3.06 percent, up 3.4 percent, Burberry BRBY, +3.07 percent, up 3%, and Hermès International RMS, +2.24 percent, up 2.7 percent. Oil prices CL.1, +1.99 percent BRN00, +1.73 percent rose amid an overall asset bounce, allowing energy corporations to recoup earlier losses. TotalEnergies TTE, +1.06 percent TTE, +0.58 percent, Royal Dutch Shell RDS.A, +0.99 percent RDSA, +0.07 percent, and BP each saw their shares rise 0.8 percent. Vectura Group VEC, +13.72 percent saw its stock rise 13 percent as a result of the deal. In a deal valued at 1.05 billion pounds ($1.45 billion) in cash, Philip Morris International PM, +1.58 percent announced Friday that its subsidiary PMI Global Services has agreed to bid for the U.K. developer of inhaled medicines for the treatment of respiratory disorders. According to Philip Morris, the acquisition is part of the company’s development into products other than tobacco and nicotine. Volkswagen’s early figures, announced Friday afternoon, showed that it swung to an operating profit of roughly 11 billion euros ($13.03 billion) for the first half. It stated that customer deliveries continued to improve, resulting in high group turnover. Global semiconductor bottlenecks have changed, according to the company, and will have an influence on operations in the second half. Volkswagen VOWB, +5.58 percent VOW3, +5.81 percent, Stellantis STLA, +2.82 percent, and BMW shares BMW, +3.41 percent all gained more than 5%./nRead More

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