European stocks marched higher on Monday, December 14, buoyed by COVID-19 vaccine optimism and hopes of a last-minute Brexit deal, but fears of new United States shutdowns undermined Wall Street’s early gains.
Even as the first Americans began to receive the vaccine, after last week’s emergency authorization, the bellwether Dow Jones Industrial Average ended with a loss of 0.6% after hitting a 52-week high during the trading session, and the broad-based S&P 500 fell 0.4%.
US regulators gave the go-ahead for the use of the Pfizer-BioNTech vaccine on Friday, December 11, and officials said 20 million Americans could receive a first of two required injections by the end of the year and 100 million by March.
But the US coronavirus death toll hit 300,000 on Monday and analysts at Schwab cautioned that “we’re not yet out of the coronavirus tunnel.”
As infections continue to mount, New York City Mayor Bill De Blasio warned the city could experience another “full shutdown” soon.
There was renewed, if cautious, hope about a new US economic relief package, as a bipartisan group of lawmakers in Washington was set to formally release a $908-billion compromise package.
The plan includes new unemployment aid, help for state and local governments, and limited liability protections for businesses.
But there have been few signs in recent days that the latest offer would be enough to win support in the Republican-controlled Senate or the Democrat-controlled house.
‘Narrow path for Brexit’
In Europe, glimmers of hope for a last-minute Brexit deal kept markets looking up through the close of trading, with Germany’s DAX 30 adding 1%, the French CAC 40 0.5%, and the Euro Stoxx 50 0.7%.
A European Union (EU) diplomat said that the Brussels’ chief negotiator Michel Barnier had spoken of a “narrow path” to a trade deal to govern relations once a standstill transition period expires on December 31.
British Prime Minister Boris Johnson and EU chief Ursula von der Leyen had said after a crisis call that they would “go the extra mile” to find common ground in long-running talks between Brussels and London.
They agreed to extend the negotiations beyond the deadline on Sunday, December 13, with sticking points on issues including fishing rights and fair trade regulations.
The news gave the pound a boost against the dollar and euro, although Johnson warned a deal was far from sure with less than 3 weeks until Britain leaves the single market on December 31.
“I’m afraid we’re still very far apart on some key things, but where there’s life there’s hope,” he said.
The talks between the EU and Britain indicated there was still hope of a last-minute deal, OANDA analyst Craig Erlam said.
“It does seem like some progress is being made and with neither side willing to be the ones to call off the talks; a minute-to-midnight compromise looks likely,” Erlam said.
With the pound stronger, London’s multinational-heavy FTSE 100 index was weighed down, shedding 0.1%.
Key figures around 10 pm GMT
- New York – Dow: DOWN 0.6% to 29,861.55 (close)
- New York – S&P 500: DOWN 0.4% at 3,647.49 (close)
- New York – Nasdaq: UP 0.5% at 12,440.04 (close)
- London – FTSE 100: DOWN 0.1% at 6539.98 points
- Frankfurt – DAX 30: UP 1% at 13,242.39
- Paris – CAC 40: UP 0.5% at 5,536.84
- EURO STOXX 50: UP 0.7% at 3,509.06
- Tokyo – Nikkei 225: UP 0.3% at 26,732.44 (close)
- Hong Kong – Hang Seng: DOWN 0.4% at 26,389.52 (close)
- Shanghai – Composite: UP 0.7% at 3,369.12 (close)
- Pound/dollar: UP at $1.3325 from $1.3224 at 10 pm GMT
- Euro/pound: DOWN at 91.12 pence from 91.59 pence
- Euro/dollar: UP at $1.2146 from $1.2112
- Dollar/yen: DOWN at 104.00 yen from 104.24 yen
- West Texas Intermediate: UP 1.01% at $47.04 per barrel
- Brent North Sea crude: UP 0.7% at $50.33
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