Europe close: Stocks fall as investors wait on result of stimulus talks in US
European stocks finished lower on Thursday as investors kept an eye on talks on Capitol Hill on a fourth fiscal stimulus package and despite reports of some concessions from Republicans.
Investors were concerned that Washington, having "struggled to develop a coherent response to the virus itself, will now fumble its plan to save the economy," said IG chief market analyst Chris Beauchamp.
Meanwhile, Johns Hopkins University reported 52,800 new US cases Covid-19 cases on Wednesday, down 25.4% from the 70,800 recorded at the same time a week ago.
"This looks great, but the rate of decline probably is substantially overstated, because the number of new tests yesterday fell by 20.3% compared to a week ago, the seventh straight decline," said Pantheon Macroeconomics's Ian Shepherdson.
By the end of trading, the benchmark Stoxx 600 was off by 0.73% to 362.49, alongside a fall of 0.98% to 4,885.13 for the French Cac-40 while the FTSE Mibtel was down 1.34% at 19,475.15.
Germany's Dax on the other hand retreated by just 0.54% to 12,591.68, helped by the release of data showing that factory orders in the country jumped back at three times the expected rate in June.
Euro/dollar meanwhile was edging up 0.04% at 1.1882 while December gold futures on COMEX climbed 0.64% to $2,082.6/oz..
Britain's FTSE 100 on the other hand was down 1.27% to 6,026.94 after the Governor of the Bank of England, Andrew Bailey, told reporters that negative interest rates "are part of our toolbox, but at the moment we don’t have a plan to use them."
That sent Sterling bounding up by 0.5% to 1.3176 with the rise in the pound sapping the strength of the top-flight index.
Bailey nonetheless described the current outlook as "unusually uncertain", adding that at this time the Monetary Policy Committee's "medium-term projections are a less informative guide than usual."
Irish lender AIB Group was among the top fallers on the Stoxx 600 after booking €1.2bn of loan loss provisions, for an interim loss of €700m in the first six months of the year.
The news weighed on stock in fellow Irish lender Bank of Ireland.
Dutch lender ING Group also topped up its loan loss provisions, by €1.34bn, taking the year-to-date increase to approximately €2.0bn.
But investors pushed ING shares higher after its new chief executive officer, Van Rijswijk, signalled that the worst on the bad loans front may now be past.
Shares of Eurofins Scientific were the top performer on the Stoxx 600, hitting fresh record highs after the international laboratory testing group posted better than expected interim profits, together with what analysts at Goldman Sachs termed a "strong" outlook for the back half of 2020.
In other economic news, German industry delivered a blow-out performance in June, with the Office of Federal Statistics announcing a 27.9% month-on-month increase for factory orders (consensus: 10.1%).
Against a year ago, factory orders were down 11.3% versus a 29.3% decline in the month before (consensus: -18.5%).
Italian industrial production for June was reported at up by 8.2% month-on-month in June by ISTAT (consensus: 9.0%).