LONDON, U.K. – European shares edged higher on Tuesday, recording modest gains following the sharp losses during the trading session on Monday amid the increasing caution against the spread of a potentially deadly virus in Asia.
European stocks market made a rebound on Tuesday’s trading session, although the overall tone in the market is of caution. Meanwhile, shares highly exposed to consumers in China are expected to remain weak.
At around 2:05 ET, Germany’s DAX futures edged higher by 0.6%, adding 83 points from its previous close. The CAC 40 futures contract in France also increased by 0.6%, going up by 33 points, while UK’s FTSE 100 futures contract recorded a 0.5% advance to ass 36 points. Furthermore, the Euro Stoxx 50 pan-eurozone index futures gained a heaping 0.7% to add 24 points.
The stock market in Hong Kong and mainland China remained closed for the day, but shares from select open markets in Asia were down. The Nikkei 225 index in Japan closed today’s session with a 0.6% decline.
The recent headlines on the spreading of the coronavirus have soured some of the market sentiments. Earlier, according to reports, the death toll of the deadly virus has already increased to 106. The number of people confirmed affected by the virus in China has climbed to 4,515 as well, according to the National Health Commission of the country. Wuhan recorded all but six of the numbers of the death caused by the virus, the city where the strain was first noticed as well.
While some cases of the virus were recorded in other countries, fatalities from the virus remained concentrated in China.
Meanwhile, the Chinese government continues its efforts to mitigate the further spreading of the virus. China has closed entire cities, which isolated around 50 million in regions bordering Wuhan. The government has also declared shut down for several public transport networks and long-distance buses.
Wall Street, on the other hand, closed mostly in the red during Monday’s session following the sharp decline in the Euro market the previous day. The Nasdaq Composite index was trading down by 1.9% yesterday, while the S&P 500 and the Dow Jones Industrial Average both went down by 1.6%.
With the recent declines in Wall Street, Saxo Bank Group’s Head of Equity Strategy, Peter Garnry, said that equities have recently started to contemplate the possibility that the coronavirus in China has a critical impact in the economy. He said that sectors most sensitive to virus headlines and the economic impact the comes with it include the consumer discretionary, energy, materials, industrials, and IT sectors.
Meanwhile, the market also awaits Apple’s scheduled earnings report later in the day.