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Market Outlook: Coronavirus outbreaks leave stocks stuck in their ranges, Costain, Lookers & more

London shares are struggling for direction in morning trading
Market Outlook: Coronavirus outbreaks leave stocks stuck in their ranges, Costain, Lookers & more

Virus outbreaks in the US continue to weigh on the mood, as it suggests the run-up in stocks on hopes for a V-shaped economic recovery may be overly optimistic. Several states, mainly in the south, have been forced to re-impose lockdown restrictions after being the first to reopen. Dr Fauci described it as a ‘serious problem’. The dangers of reopening too quickly seem all too apparent, but investors are also keeping an eye on outbreaks in Tokyo, Australia and China. 

European equities were a touch softer but trading near the flatline on Monday morning, with a general lack of direction about today’s trade. Major indices tracking around the middle of their June ranges after Asian equities fell. US equities were lower Friday and finished down for the week but, as the month ends, stocks have enjoyed a very strong quarter. The FTSE 100 is up over 8 per cent quarter-to-date, while the S&P 500 has rallied over 16 per cent in Q2 and the DAX has surged 21 per cent. Valuations remain the concern as we head into earnings season with the S&P 500 still trading at more than 22x on a forward basis. 

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