Stocks in Europe stumbled on Monday as the number of new coronavirus cases across the UK continues to rise quickly and countries on the bloc announce travel restrictions for Brits.
In the week since 21 June, what would have been "freedom day" in Britain, coronavirus cases are up 59% in week-on-week figures. Currently in the UK, the Delta strain, which was first detected in India, makes up more than 99% of reported COVID-19 cases, data from Public Health England (PHE) showed.
New health secretary Sajid Javid will give an update later on when the final stage of Boris Johnson’s roadmap out of lockdown will be lifted in England. They are expected to be lifted on 19 July, however the PM said that there would be a data review to see if this could happen two weeks earlier on 5 July.
Javid’s address comes just hours after replaced Matt Hancock after he resigned on the weekend.
Analysts noted that there doesn’t appear to have been much market reaction to Hancock’s resignation due to the fact that nothing much policy wise is likely to change.
Watch: Delta Variant: all you need to know
Travel stock also suffered on Monday as Spain revealed that it will start to demand a negative COVID test, or proof of vaccination from British tourists who are looking to enter Mallorca, Ibiza, and the surrounding Balearic islands.
Meanwhile, Portugal’s government has also announced measures for UK tourists, requesting the need to quarantine for 14 days upon arrival if they are not fully vaccinated or cannot show a negative PCR test.
Tourism company TUI (TUI.L) was among the laggards, dipping 5.3% on the day, while British Airways owner IAG (IAG.L) dropped 6%, Wizz Air (WIZZ.L) shed 5.4%, Ryanair (RYA.L) was 3.7% lower, and easyJet (EZJ.L) lost 5.8%.
Across the pond, the S&P 500 (^GSPC) was trading flat and the tech-heavy Nasdaq (^IXIC) rose 0.7%, pushed higher thanks to an ongoing tech run. The Dow Jones (^DJI) edged 0.6% lower at the time of the European close.
The Nasdaq and the S&P 500 set new records last week, however, the Dow and Russell 2000 lagged behind somewhat.
“The brief spike in the US dollar that we saw in the aftermath of the Fed policy decision appears to have subsided as concerns about the timeline of US monetary policy were assuaged last week by Fed chair Jay Powell and New York Fed president John Williams,” Michael Hewson, chief market analyst of CMC Markets said.
“The overarching narrative coming out from this week’s events is that while the likes of St. Louis Fed president Bullard, and Dallas Fed Robert Kaplan have a view on how the Fed will need to act in the coming months, it is the views of the holy trinity of Jay Powell, Richard Clarida and John Williams that probably carry the most weight, and for now the Fed is not changing anything.”
Asian shares started the week in a cautious mood overnight, as a spike in coronavirus cases across the region hit sentiment.
Investors were concerned about a spike in coronavirus infections in Asia, with Australia's most populous city of Sydney plunging into a lockdown after an increase of cases involving the Delta strain.
Indonesia is battling record high cases while a lockdown in Malaysia is set to be extended. Thailand also announced new restrictions in Bangkok and other provinces.
Watch: COVID-19: Two-week lockdown imposed in Sydney as Australia battles new outbreak