European stocks continued to rise slightly on Wednesday after hesitant start-ups as investors assessed governments’ efforts to keep their societies open amid an unprecedented wave of coronavirus infections due to the highly contagious omicron mutation.
Although governments have announced some measures to protect public health, they have not returned the severe restrictions imposed in the first waves of the pandemic leading economies into recession. Schools in France have reopened after the Christmas holidays, while other countries have announced that schools will reopen as scheduled.
On the board, the pan-European Stoxx 600 index recorded small gains of 0.2% at 494.94 points after closing yesterday at a new all-time high.
The German DAX gained 0.6% to 16,246.06 points, the French CAC 40 strengthened 0.5% to 7,350.86 points, while the British FTSE 100 gained 0.3% to 7,524.00 points.
In the region, the Italian FTSE MIB recorded small gains of 0.2%, while the Spanish IBEX 35 strengthened marginally 0.04%.
At the end of the day, data released today showed that economic growth fell to a nine-month low in December, following a brief acceleration in November, returning to the downward trend that has shaped the last wave of the pandemic.
In particular, the composite PMI, which combines manufacturing and services, fell to 53.3 points in December from 55.4 in November, the IHS Markit announced today. This is the lowest level since March.
The PMI for services, meanwhile, fell to its lowest level since April at 53.1 points in December from 55.9 points in November as the industry is hit hard by rising coronavirus infections.
Earlier this week, IHS Markit announced that its manufacturing PMI had fallen to 58.0 points in December from 58.4 in November, the lowest level in ten months.
“The acceleration we saw in November was unfortunately short-lived. Amid the resurgence of COVID-19 cases across the Eurozone, growth slowed in December to a weaker pace than in March,” said Joe Hayes, Senior Economist .
The minutes of the last Federal Reserve monetary policy meeting, which will be published late in the afternoon, will also attract the attention of investors. The US Federal Reserve announced at its December meeting that it plans to accelerate the contraction of its bond-buying program, leaving open the possibility of three increases in US interest rates in 2022.
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