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European Stocks Paring Early Gains In Cautious Trade

stockmarkets jan02 14sep20 lt

European stocks are giving up gains in early afternoon trades on Monday after having opened on a bright note on renewed optimism about coronavirus vaccines.

News that AstraZeneca has resumed its Phase III trials of coronavirus vaccine after having halted trials early last week due to safety concerns following a patient's unexplained illness.

The company announced that it has got the nod from the U.K.'s Medicines Health Regulatory Authority to resume clinical trials.

Reports that Pfizer will be ready with its coronavirus vaccine in the U.S. before the end of the year contributed as well to the positive start in European markets.

However, stocks gave up morning gains as investors looked ahead to upcoming monetary policy meeting of the Federal Reserve and crucial economic data. The Bank of Japan and the Bank of England are also scheduled to announce their monetary policy decisions during the week. Concerns about continued uncertainty about Brexit negotiations and reports showing a surge in new coronavirus cases in several parts of the world weighed as well on sentiment.

The pan European Stoxx 600 is up marginally at 368.17 after having advanced to 371.04 in early trades. Germany's DAX, which gained nearly 1% earlier, is down with a marginal loss. France's CAC 40 is up 0.17%, and the U.K.'s FTSE 100 is down 0.16% after moving up by about 0.8% over last week's closing levels. Switzerland's SMI is lower by 0.19%.

In France, Valeo is gaining about 3.5%. STMicroElectronics is up 2.5% and Airbus is moving up 2%. Saint Gobain, Societe Generale, Carrefour and Engie are up 1 to 1.6%, while Technip is plunging more than 5%.

In the German market, Infineon Technologies, Lufthansa and Covestro are up 1.3 to 2%. Adidas, Continental, Allianz and Deutsche Bank are up with modest gains, while Thyssenkrupp and Fresenius are notably lower.

In the U.K. market, Ocado Group is gaining more than 3.5%, Meggitt, BAE Systems an EasyJet are rising 2.2 to 2.5%, while Informa and Aveva Group are up 1.5% and 1.3%, respectively.

IAG is plunging more than 27% weighed down by the company's move to launch a heavily discounted right issue to raise Euro 2.74 billion.

Fresnillo is down more than 6%, Royal Mail is declining 3.2% and Polymetal International is lower by about 3%. Rolls-Royce Holdings is down by about 1.7%, while AstraZeneca is down with a modest loss.

In economic news, Eurozone industrial production grew at a slightly faster than expected pace in July, as the economy attempts to sustain its recovery from the slump caused by the coronavirus, or Covid-19, pandemic.

Industrial production rose 4.1% from June, when it grew 9.5%, which was revised from 9.1% reported initially, preliminary data from Eurostat showed on Monday. Production gained for a third straight month. Economists had forecast a 4% increase.

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