European stocks edged lower on Tuesday, losing momentum after the pause of a key coronavirus vaccine trial as traders waited for earnings from some of the world’s leading banks.
Up 0.7% on Monday, the Stoxx Europe 600 SXXP, -0.13% weakened by 0.1%.
The German DAX DAX, -0.35%, French CAC 40 PX1, -0.29% and U.K. FTSE 100 UKX, -0.33% also sagged.
U.S. stocks SPX, +1.64% blasted higher on Monday on little news during a light Columbus Day holiday, with the technology-heavy Nasdaq Composite COMP, +2.55% rallying 2.6% to its third-highest close in history. But futures ES00, -0.28% NQ00, +0.77% were lower as Johnson & Johnson JNJ, +0.57% on Monday night paused its trial of a coronavirus vaccine after an unexplained illness. It isn’t uncommon for drugmakers to pause trials in this way, and so far the pause isn’t the more serious clinical hold.
Third-quarter earnings season starts on Tuesday with results from JPMorgan Chase JPM, +1.22% and Citigroup C, +2.11%, as well as Johnson & Johnson.
Thursday, meanwhile, is the U.K.’s self-imposed date to reach a trade agreement with the European Union. The current arrangement lasts until the end of the year. Data from the U.K. showed the unemployment rate rose to 4.5% in the three months ending August, which was higher than expected but masks what is expected to be a bigger jump once the job furlough program expires at the end of October.
Of stocks on the move, MorphoSys MOR, -8.79% MOR, +2.01% shares slumped 9% as the dual-listed biopharmaceutical said it is selling a €325 million convertible bond.
Rolls-Royce RR, -5.03% shares dropped 6%, the second day of sharp losses for the troubled engine maker after nearly doubling in value last week.
A Rolls-Royce customer, Airbus AIR, -2.98%, dropped 3% after a downgrade to underweight from hold at JPMorgan Cazenove. The broker cited a more cautious view on air travel and airline profitability, which led it to reduce its view on deliveries next year by 10%.
SSE’s SSE, +3.28% shares rose 4%, after agreeing to sell its 50% share in two energy-from-waste ventures for £995 million to an infrastructure fund managed by First Sentier Investors.