Off The Wire
European stocks edge higher as investors eye emergency fund vote
(Reuters) - European stocks edge higher on Thursday, reversing earlier losses as investors awaited a vote by EU lawmakers on emergency funds to cushion the blow from the coronavirus outbreak.
A stronger open on Wall Street helped sentiment, as markets clawed back some ground after big losses in the past month. [.N]
By 1430 GMT, the pan-European STOXX 600 index was trading 0.4% higher, adding to a 11% gain made over the past two days. The index had fallen up to 2% earlier in the day.
The index is still down 28% from a record peak hit in February, with a recession in Europe looking imminent in the wake of widespread disruption to business due to coronavirus.
European Union lawmakers were expected later on Thursday to approve emergency funds to cushion the bloc’s economic slump triggered by the pandemic and shore up hard-hit airlines by preserving their landing slots.
Overnight, the European Central Bank ditched a cap on how many bonds it could buy from any single euro zone country, clearing the way for potentially unlimited money-printing as part of its response to the outbreak.
The travel and leisure industry .SXTP led gains for the day, adding about 4% as investors bought back into the worst hit sector.
Italian .FTMIB and Spanish .IBEX bourses trimmed the day's losses, but still traded lower as the number of fatalities from COVID-19 in Italy topped 7,500, while those in Spain rose beyond 3,400, exceeding the total death toll in China.
“We’ve had a few days of recovery in prices, but we are unlikely to see a sustained recovery until we get a sense that the pandemic is under control in most countries,” said Simona Gambarini, markets economist at Capital Economics in London.
As new cases show little signs of peaking, Europe’s disease control agency said every country in the bloc was forecast to run out of intensive care beds by mid-April.
German shares .GDAXI fell 0.3%, while a survey showed consumer morale in Europe's biggest economy tumbled to its lowest level since 2009. Gains on Tuesday and Wednesday had added up to the market's biggest two-day rise since 2008.
In a further sign of duress from the outbreak, data showed U.S. jobless claims surged to a record 3.28 million last week as measures to contain the virus brought business activity in the world’s largest economy to a grinding halt.
Reporting by Sagarika Jaisinghani in Bengaluru; Editing by Shounak Dasgupta and Edmund Blair