European stocks opened in the red but reversed course in early Tuesday trading
European stocks climbed higher on Tuesday after opening in the red, as investor concerns persist over the volatility in technology stocks against the backdrop of rising bond yields.
Both the pan-European Stoxx 600 XX:SXXP and London’s FTSE 100 UK:UKX index were 0.3% higher. The CAC 40 FR:PX1 in Paris rose around 0.1% and Frankfurt’s DAX DX:DAX lifted 0.2%.
Dow futures DJIA FUTURES were pointing up more than 200 points, set for a strong open to continue the Dow’s DJIA march higher after the index closed at a record high of 31,802 on Monday.
Major European markets opened lower across the continent but reversed course in early Tuesday trading to push into the green. Germany’s DAX continued into record high territory for the second straight day.
“As European markets opened lower this morning, it’s been a more subdued start to proceedings, after another record-breaking session for the DAX yesterday, and a new record high for the Dow,” said Michael Hewson, an analyst at CMC Markets.
“Even though we’ve edged back into positive territory, it is becoming increasingly difficult to interpret what effect the continued volatility in tech stocks could have on wider sentiment after the Nasdaq’s big falls yesterday,” Hewson added.
The Nasdaq COMP tumbled a further 2.4% in Monday trading, with the index now down more than 10% since highs in mid-February. The fall in tech stocks has come amid rising bond yields. Nasdaq futures NASDAQ 100 FUTURES were pointing up around 2% on Tuesday.
Chinese state funds have stepped in to buy stocks amid a worsening bear market, according to a report from Bloomberg. The Shanghai Composite Index CN:SHCOMP ended the day 1.82% lower and is down more than 9% since highs in late February.
Elevated oil prices have the major European-listed oil stocks continuing their climb higher. Benchmark Brent crude UK:BRENT CRUDE rose around 0.6%, approaching the $68.70 per barrel mark after touching $70 on Monday. Shares in BP UK:BP, Royal Dutch Shell UK:RDSA, Total UK:TTA, and Eni IT:ENI all surged, outpacing gains in major indexes.
But metals and mining stocks represent the other side of the commodities seesaw. Industrial metals in particular have fallen, with copper COPPER down more than 1% and iron ore futures for April TIOJ1 down near 6%. Shares in London-listed Rio Tinto UK:RIO, BHP UK:BHP, Anglo American UK:AAL, Antofagasta UK:ANTO, and Glencore UK:GLEN, which are all major miners of copper or iron, were among the largest fallers in London trading.
Fresnillo UK:FRES stock was higher as precious metals gold GOLD and silver SILVER surge. The company is a major gold miner and the world’s largest silver miner.
Shares in Domino’s Pizza Group UK:DOM, the mid-cap FTSE 250-listed U.K. franchisee of the American pizza company, jumped more than 12% after full-year results firmly beat expectations. The company also announced a £88 million return to shareholders through dividends and buybacks.
DAX-listed Continental XE:CON, a major automotive parts manufacturer, was a major faller in German trading following the release of full-year results. The shares were more than 5% lower, after the company said sales fell from €44.5 billion in 2019 to €37.7 billion in 2020.
Shares in British television channel ITV UK:ITV opened near 7% lower, settling down 2%, after full-year results partially missed expectations. Group revenues fell 16% across 2020 while operating profit slumped more than 33% amid production disruptions due to the COVID-19 pandemic and a decline in advertising business.