European stock dropped before the launch of the Euro summit

European blue chips dropped before the Euro summit taking place this weekend. The decline was caused partially due to market nervousness on recovery funds discussed by European leaders. Moreover, the growing tensions in the U.S.-China trade relations did its part. 

Euro, EU, Europa, eurozone

Pan-Europe stock index SOXX 600 wrote off 0.7% during Thursday trading, when previous session ended in record-high levels of last 5 weeks. Stock of the old continent were pushed down by titles such as Dutch brewery Heineken (-4.9%) or luxury goods company Richemont (-5%). Sales of both companies were hit by coronavirus pandemic in second quarter of 2020. 

Apart from growing tensions in U.S.China trade relations, the European Central Bank supported the slump. As markets did not receive any surprising decision in monetary policy, there was no reason to positively react on ECB chief’s announcement, Christine Lagarde confirmed that ECB will continue in its monetary policy. The sleepy mood on European stock exchanges was connected to the upcoming weekend, when representatives of the European Union meet to discuss recovery funds. A proposal of recovery funds had been drafted by the European Commission, and further discussions are predicted to be demanding. 


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