European stocks mixed on Tuesday afternoon in London, as investors parsed a potential extension to the final unlocking phase in England as well as worse-than-expected industrial production numbers from Germany.
A report in The Times suggested that the lifting of lockdown restrictions in England could be delayed by two weeks, citing a pessimistic briefing from medical chiefs Chris Whitty and Sir Patrick Vallance.
The Times said that the delay would allow for over-50s to be fully vaccinated and for the jabs to kick in.
The main concern at the moment is the effects of variants of the coronavirus, and the millions of people that remain unvaccinated in the UK.
Alongside this, industrial production numbers in Europe's largest economy, Germany, released earlier this morning, missed expectations.
Industrial production dropped by 1.0% month-on-month in April, from 2.2% month-on-month in March. On the year, industrial production was up by more than 26%.
"Despite today’s disappointment, the industrial outlook remains bright," said Carsten Brzeski, global head of macro at Dutch investment bank ING. "Filled order books and low inventories bode well for industrial activity in the months ahead. Even if production expectations have recently come off all-time highs, industrial production should remain an important growth driver this year."
Investors will be watching for the eurozone employment numbers and GDP readings out later on Tuesday.
Oil prices took a hit with crude (CL=F) futures sinking 0.8%. Futures came off a rally that saw it hit $70 a barrel for the first time since October 2018. Oil is currently trading at $68.69 per barrel.
The Nasdaq (^IXIC) was 0.1% lower.
"Although both the S&P 500 and Dow Jones are on the cusp of closing at new all time-highs and the Nasdaq is extending its rebound from the May dip, there doesn’t seem to be much momentum in equity markets at the moment," said Raffi Boyadjian, senior investment analyst at XM.
Traders will be looking to Thursday, when new data will give an indication of the effects of inflation — a measure which has caused great concern in recent weeks due to generous stimulus spending.
Traders are weighing the delicate balance of what appears to be economic recovery versus risks of inflation.
Japan's Nikkei (^N225) also retreated 0.2% following news that its economy contracted at a 5.1% annual pace in January-March, revised upward from the earlier reported 6.3% contraction. On a quarterly basis, the economy shrank 1% instead of the preliminary minus 1.3%.
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