European shares edge higher as investors eye EU leaders summit

European shares closed on Friday slightly higher as investors awaited the outcome of an EU summit where leaders are expected to hammer out details of a €750 billion recovery fund.

The pan-European Stoxx 600 index ended the session 0.2 per cent ahead at 372.7, after rallying earlier this week to the highest since early June, mostly on hopes an EU-wide fund to support pandemic-struck economies could lift the union out of recession.

Dublin

The Iseq index in Dublin closed 0.7 per cent lower at 6,221.25, with housing stocks and industrial companies out of sorts amid concerns that the State could return to phase two restrictions if the number of coronavirus cases continued to rise.

Cairn Homes lost 4.2 per cent to 81c, while Glenveagh Properties edged down 0.3 per cent to 69.5c. Insulation group Kingspan was also out of sorts, declining by 2.4 per cent to €62.20.

Tesla results next week may put skids on shares fuelled by Fomo

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European shares rally as attention turns to EU recovery fund

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BlackRock saw investors jump back in to mutual funds

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Finished product shipments fall almost 30% at Kenmare Resources

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Bucking the trend, AIB added 4.4 per cent to €1.20, while Bank of Ireland gained 1.9 per cent to €1.84, with dealers saying that the market was taking comfort out of the fact that the Government Ministers, having met industry chiefs in recent days, were playing down calls that banks should be forced to forgo applying interest to loans subject to payment breaks.

Fluctuating oil prices weighed on Tullow Oil, which lost 4 per cent, and Providence Resources, which declined by almost 19 per cent.

London

The FTSE 100 rebounded from early losses to snap a three-week losing streak as growing hopes for a coronavirus vaccine pushed up the healthcare sector.

The blue-chip FTSE 100 ended up 0.6 per cent, bolstered chiefly by AstraZeneca amid anticipation of a deal with Russia to manufacture a Covid-19 vaccine being developed by the drugmaker and Oxford University.

Global miner Rio Tinto advanced after posting stronger second-quarter iron ore shipments and flagging improving Chinese demand for the steelmaking ingredient.

Improving Chinese demand has pushed up metal prices, while weakness in the pound has helped local resource exporters. Miner Fresnillo was the best weekly performer on the FTSE 100, adding about 16 per cent.

Banking major HSBC shed about 1.6 per cent for the day following reports that the bank's global equities chief Hossein Zaimi was stepping down.

Europe

Sweden's main stock index scaled a near five-month high as telecoms equipment maker Ericsson surged 11.4 per cent after smashing core profit expectations. Its shares posted their best one-day percentage gain in more than two years.

Tobacco group Swedish Match AB jumped 10.4 per cent on better-than-expected quarterly profit.

Among auto stocks, Daimler rose 4.4 per cent after posting a smaller-than-expected operating loss in the second quarter, while truck maker Volvo AB rose after beating profit forecasts.

New York

The S&P 500 edged was marginally higher mid-afternoon in an otherwise choppy trading session, as investors juggled between prospects of more fiscal stimulus and fears of further business disruptions due to another record-breaking rise in coronavirus cases across the country.

Netflix’s shares fell after it forecast slower-than-expected subscriber growth during the third quarter.

"It's going to be fairly range bound until we get more transparency into exactly how the coronavirus virus is going to affect us long term," said David Trainer, chief executive officer of investment research firm New Constructs in Nashville, Tennessee.

“I don’t see a lot of downside, but I do see a lot of rotation away from the really expensive large-cap tech names, into more reasonably valued individual security.”

High-flying companies including Microsoft, Apple and Amazon. com which have powered Wall Street's recovery since March slipped on Friday.

BlackRock, the world’s largest asset manager, rose after reporting a jump in quarterly profit as investors poured money into its fixed-income funds and cash management services.

As the second-quarter earnings season gets under way, investors are looking for clues on the path of recovery for corporate America. Unprecedented stimulus measures and improving economic data have helped the S&P 500 rise to within 5 per cent of its February record high.

– Additional reporting: Reuters