On Monday, at 07:50 GMT, UK’s FTSE 100 index fell by 0.5%, France’s CAC40 was down by 0.5%, and Germany’s DAX fell 0.1%. The travel sector led the sharp losses in the stock market amid the UK government’s decision to quarantine Spain visitors and fear of the second wave of COVID.
On the weekend, the UK administration decided to quarantine all visitors from Spain, a popular tourist destination, due to rising COVID cases. In response, the travel sector was hit hard. In numbers, popular airlines Easy Jet and Tui both fell 13%, and IAG dropped more than 10%. Among the other losers were Ryanair, Europe’s Low-Cost Airline, which traded around 8% lower.
The market fell despite the optimistic news from China, which earlier reported that its large industrial corporations had posted the rise in earning at the strongest pace in June, after March 2019. The growth was 11.5% more than June 2019 and is double from May 2020, which posted an earning growth of 6.0%.
Asia’s China is a significant market for European exporters, and the positive news and signs of recovery from the nation boosted Europe’s corporate sector, which also made a growth comeback in July.
Meanwhile, Germany’s IFO Index also traded a bit higher than experts’ prediction in July and in addition, SAP, the German software firm, also went 2.7% upward after it announced its increased operating profits and revenue in the second quarter. The company last year scrapped its co-CEO model and is in the league of improved performance since then.
The tensions about the second wave of the coronavirus and the damage it would cause to the whole of Europe and not only Spanish tourist season has overshadowed the news from China.
Royal KPN also plunged 3.3& despite posting a 6.3% increase in net profits in the second quarter. Oil was also a little down on Monday but the metals, gold and silver, doesn’t seem to get affected and keeps rising.