FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, July 13, 2020. REUTERS/Staff
(Reuters) – European stocks opened lower on Tuesday, hit by a drop overnight on Wall Street following a flare-up in U.S.-China tensions and new coronavirus restrictions.
The pan-European STOXX 600 index fell 1.3% by 0712 GMT, with technology stocks .SX8P slumping 2.7%.
U.S. tech majors lost momentum on Monday after California shut bars, banned restaurant dining and other businesses to contain a surge of coronavirus infections, raising fears it may slow a U.S. economic recovery. [.N]
Meanwhile, Washington on Monday rejected China’s disputed claims to offshore resources in the South China Sea, a move that Beijing criticised as inciting tensions in the region.
The latest skirmish dampened risk sentiment even as investors were hopeful that companies will surpass beaten-down earnings expectations with the reporting season underway.
German meal-kit delivery firm Hellofresh (HFGG.DE) gained 4.3% as it raised its full-year revenue forecast, while industrial technology group Hexagon (HEXAb.ST) jumped 5.9% after forecasting second-quarter profit above market expectations.
Norwegian oil firm Aker BP (AKERBP.OL) slipped 2.4% as crude prices fell, but the company beat second-quarter pre-tax profit expectations.
Reporting by Sruthi Shankar in Bengaluru