European shares post third week of gains

European stocks slid on Friday after France imposed fresh regional lockdowns to curb the spread of the coronavirus, amid concern over the pace of vaccination campaigns in some countries, while bank stocks led sectoral declines.

The pan-European STOXX 600 fell 0.8%, with France’s CAC 40 dropping 1.1% after the nation imposed a new four-week lockdown from Friday in 16 regions badly hit by the COVID-19 crisis.

Concerns over the pace of vaccination gained ground after Britain said it will have to slow its rollout next month due to a supply crunch caused by a delay in shipment.

European stocks still gained 0.2% for the week as a rally in automakers and signs that the U.S. Federal Reserve will maintain low interest rates despite an expected surge in economic growth outweighed concerns about rising yields.

Automakers fell 1.6% after a strong run, ending with the sector’s best weekly performance since early February. The banks index tumbled 2.3%, posting the biggest declines among European

sectors on Friday.

Lenders were particularly affected by downbeat sentiment spilling over from Wall Street after the Fed said it would not extend a temporary capital buffer relief put in place to ease a pandemic-driven stress in the funding market.

MSCI’s gauge of stocks across the globe shed 0.29%. Investors were seeking the next reasons to add risk following the passing of President Joe Biden’s $1.9 trillion stimulus plan, broadening U.S. COVID-19 vaccinations and encouraging economic news.

Markets have been consumed by the surge in U.S. bond yields, with investors still digesting the Fed’s meeting earlier this week. The central bank said it expects higher economic growth and inflation in the United States this year, although it repeated its pledge to keep its target interest rate near zero.

Oil prices gained after falling about 7% in the prior session, when a new wave of coronavirus infections across Europe dampened expectations of any imminent recovery in fuel demand.

This article was compiled by BOV Asset Management Limited, a member of the BOV Group. BOV Asset Management,TG Complex, Suite 2, Level 3, Brewery Str., Mriehel BKR 3000. Email: infoassetmanagement@bov.com Internet address: www.bovassetmanagement.com. BOV Asset Management is licensed by the MFSA.