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Major European Markets Recover From Day's Lows, Still End The Session On Weak Note

European markets closed mostly higher on Wednesday, reacting to fairly encouraging economic data from the euro area, China and the U.S., and positive news about a potential coronavirus vaccine.

Drug giant Pfizer and German biotech company BioNTech announced positive data from an early-stage human trial of a potential coronavirus vaccine. The companies said the most advanced of four investigational vaccine candidates was generally well tolerated and produced neutralizing antibodies.

Worries about rising new cases of coronavirus infections and Brexit concerns weighed on sentiment early on in the session.

The pan European Stoxx 600 moved up 0.24%. The U.K.'s FTSE 100 ended lower by 0.19%, France's CAC 40 edged down 0.18% and Germany's DAX shed 0.41%, while Switzerland's SMI advanced 0.44%.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Finland, Greece, Ireland, Netherlands, Norway, Poland and Sweden moved higher.

Iceland, Portugal and Turkey ended weak, while Spain closed flat.

In the U.K. market, Smith & Nephew gained about 4.5% after the company said it expects a second quarter underlying revenue decline of around 29%.

Meggitt also gained more than 4%. The company announced that it has sold its US subsidiary, Meggitt Training Systems, to a US private investment firm Pine Island Capital Partners LLC, for $146 million in cash.

Carnival, Centrica, Burberry Group, Compass Group, Intercontinental, Melrose and Associated British Foods gained 2.5 to 4%.

On the other hand, Hargreaves Lansdown, ITC, Polymetal International, Evraz, Ds Smith, Anglo American, Taylor Wimpey, J Sainsbury and Rio Tinto lost 2 to 5%.

In France, Technip rallied 3.8% and Sodexo gained nearly 3%. Essilor, Saint Gobain, Airbus and Bouygues also closed higher.

Renault declined nearly 4%. Accor, Michelin, Carrefour, Publicis Groupe, BNP Paribas, STMicroElectronics and Peugeot ended down 1.6 to 2.4%.

In Germany, Henkel, Fresenius Medical Care, Beiersdorf and Merck gained 1 to 1.7%, while Wirecard plunged more than 15%. Continental, Thyssenkrupp and Vonovia lost 2.3 to 3%.

Swiss stock Clariant moved up sharply after the company completed the $1.6 billion sale of its masterbatches unit to PolyOne Corp.

In economic news from Europe, the severe downturn in the euro area manufacturing sector continued to ease in June amid easing of restrictions related to coronavirus pandemic, final survey data from IHS Markit showed. The final factory Purchasing Managers' Index rose to a four-month high of 47.4 in June from 39.4 in May and improved from a flash reading of 46.9. Nonetheless, the reading was below the neutral 50.

Final data from IHS Markit showed the UK manufacturing sector showed signs of stabilizing in June, following the steep downturn caused by the coronavirus, or Covid-19, pandemic. The Chartered Institute of Procurement & Supply/ IHS Markit manufacturing Purchasing Managers' Index rose sharply to 50.1 in June from 40.7 in May. The reading came in line with the flash estimate.

Data from the British Retail Consortium showed shop prices in the U.K. declined for the thirteenth straight month in June but the pace of decrease slowed. The BRC-Nielsen shop price index declined 1.6% in June.

According to the Nationwide Building Society, UK house prices declined for the first time in seven-and-a-half years in June, dropping unexpectedly by 0.1% on a yearly basis after rising rising 1.8% in May. Economists had forecast an annual increase of 1% for June.

Month-on-month, house prices fell 1.4% but slower than the 1.7% decline seen in May. Prices were forecast to drop 0.7%.

In Germany, retail sales rose 3.8% on year in the month of May, reversing a 6.4% drop in April, figures from Destatis revealed. Economists had forecast sales to fall 3.5%. Month-on-month, retail sales advanced 13.9%, in contrast to a decline of 6.5% logged in April. This was much bigger than economists' forecast of 3.9%.

Data from the Federal Employment Agency revealed that the number of unemployed persons in Germany rose by 69,000 in June, compared to economists' forecast of 120,000. In May, the number of people out of work increased by 237,000. The unemployment rate rose to 6.4% in June from 6.3% a month ago.

Sweden's central bank expanded its quantitative easing and maintained interest rate at zero to support recovery. The central bank signaled that it is prepared to take the rate to negative zone.

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