European Markets Open Higher, Infineon Weighs Weighs On DAX

On Tuesday European Markets traded higher, helped by optimism that the region is finally turning the corner as its economies reopen. Confidence is growing throughout Europe over its recovery from the pandemic as the rate of vaccination in EU member states rises quickly. On Monday, the European Commission put forward a plan to reopen the continent to holidaymakers from countries with low Covid infection rates, such as the U.K., and to anyone who has been fully vaccinated, by the start of June.

In the U.S. there seems to be a similar optimism, with many states continuing to relax pandemic restrictions amid the vaccine rollout. New York, one of the hardest affected of the U.S. states, just announced that most mobility restrictions will soon be lifted, while 24-hour subway service will resume in New York City later this month.

The country’s second wave of Covid-19 infections  shows no signs of slowing down, with the number of reported cases topping 20 million earlier Tuesday. The World Health Organization stated last week that one in every three new coronavirus cases globally is being reported in India.

On the other hand in Europe, Infineon stock slumped 3.3%, dragging the DAX index lower, despite the German chipmaker raising its guidance for revenue and margins in the current fiscal year, with semiconductor demand booming. It noted that the outage of its manufacturing plant in Texas, which went offline after the severe winter storms in February, would continue to constrain sales growth in the current quarter.

Telenor ASA  stock fell 2% after the Norwegian telecommunications company posted a first-quarter net loss on the back of writing off the value of its Myanmar operation in light of the country’s deteriorating security and human rights situation.

Mediaset stock rose 4.2% after the Italian broadcaster and its second-largest investor, French media group Vivendi up 0.3%, signed a long-awaited agreement to end years of legal sparring over a collapsed pay-TV deal.

Dassault Aviation stock rose 7% after Egypt’s defense ministry said it had signed a contract with France to buy 30 Rafale fighter jets.

Oil prices were higher with investors digesting the ever increasing number of Covid-19 cases in India but also the continued economic recovery in regions such as Europe and the U.S.