LONDON – European equities rose on Tuesday, with investors focusing on an emerging battle between vaccine maker AstraZeneca and the EU, and on political uncertainty in Italy.
The pan-European Stoxx 600 hovered 0.3% above the flat line at the start of negotiations, with financial services increasing 1.3%, while travel and leisure stocks fell 0.9%.
Swedish-British pharmaceutical company AstraZeneca has been accused by the EU of not doing enough to resolve a dispute over how many doses it will be able to deliver to the bloc. The AstraZeneca vaccine has not yet been approved by the European Medicines Agency, but is expected to be imminent. AstraZeneca said last week that it is experiencing production problems.
In another news story about the coronavirus, Moderna said on Monday that it is speeding up work on a Covid-19 booster injection for the variant recently discovered in South Africa. The company’s researchers said its current coronavirus vaccine looks like work against the two highly transmissible strains found in the UK and South Africa.
Italian stocks will be watched closely on Tuesday, when a new political crisis comes to light. Prime Minister Giuseppe Conte is due to resign on Tuesday after a morning cabinet meeting and will seek to lead a new term. The change comes after weeks of tensions between Conte and Matteo Renzi, head of a junior coalition party in the government.
Elsewhere, US stock futures fell slightly on Tuesday morning, as Wall Street prepared for the heart of corporate earnings seasons; General Electric, Verizon and Johnson & Johnson are expected to release the results ahead of the bell, while tech giant Microsoft will announce its second quarter fiscal earnings after the bell. In Asia-Pacific, stocks fell in Tuesday’s trade.
Profits remain in focus, with UBS reporting a net profit of $ 1.71 billion on Tuesday in the fourth quarter of 2020, a 137% jump over the previous year and largely exceeding analysts’ expectations of $ 967 million, according to Refinitiv. The shares of the world’s largest wealth manager rose 4% in the first trades.
Greater movements
Spanish dealership Naturgy saw its shares rise by more than 15% in the first trades after the IFM Global Infrastructure Fund made an offer of € 5 billion ($ 6.06 billion) for a stake in the company.
EQT’s shares rose more than 10% after the Swedish private equity firm exceeded full-year earnings expectations and agreed to buy the Exeter Property Group.
At the bottom of the European blue chip index, Rolls-Royce shares fell more than 8% after the aircraft engine maker revised its 2021 forecast down amid new Covid-19 travel restrictions.