The Malta Independent on Sunday
European stocks record worst weekly performance since October
European stocks slid on Friday, recording their worst weekly performance since October as concerns around the slow rollout of COVID-19 vaccines mount, while a retail trading frenzy led to volatility on Wall Street.
The benchmark STOXX 600 index closed 1.9% lower, erasing all of January’s gains and ending the week down 3.1% and U.S. stocks fell more than 1% after underwhelming COVID-19 vaccine data from Johnson & Johnson. Concerns around the potential economic damage from a new strain of the coronavirus in Europe and delays to vaccine rollouts have dented sentiment in the past few days.
In the U.S., where the stock market enjoyed a stimulus-led rally last year, volatility was seen following steep gains in heavily shorted stocks, including Gamestop and AMC Entertainment after retail traders piled in.
Europe’s medicines regulator approved AstraZeneca and Oxford University’s COVID-19 vaccine for people over the age of 18 on Friday, the third vaccine to be cleared for use in the European Union. Europe urgently needs more shots to speed up its inoculation programme, with AstraZeneca, Pfizer and Moderna facing difficulties in delivering the shipments to the bloc.
Economy-linked stocks of banks, insurers, miners and oil & gas companies were among the worst hit this week but Germany and Spain’s economies recorded growth in the fourth quarter, while the French economy contracted by a smaller than expected rate.
MSCI’s benchmark for global equity markets fell 1.82%, while Europe’s broad FTSEurofirst 300 index closed down 1.95% to post its worst weekly loss, at 3.3%, since October. On Wall Street, the Dow Jones Industrial Average and the Nasdaq Composite suffered their biggest weekly fall since the end of October. MSCI’s broadest index of Asia-Pacific shares outside Japan posted a weekly loss of 4.4%. Japan’s Nikkei fell 1.9%, recording its first weekly loss of the year.
Oil prices traded mixed as demand concerns caused by new coronavirus variants and slow vaccine rollouts offset a cut in Saudi Arabian oil supply and falling U.S. oil inventories.