European stocks gave up gains and turned lower on Friday, as investors kept watch on the fast spreading delta variant of the coronavirus that causes COVID-19, and absorbed a fresh batch of earnings.

The Stoxx Europe 600 index
SXXP,
-0.45%

slipped 0.2% to 455.31, with the German DAX 30
DAX,
-0.71%

dropping 0.3% and the French CAC 40
PX1,
-0.82%

losing 0.6%. The FTSE 100 index
UKX,
-0.22%

was flat.

U.S. stocks
DJIA,
-0.39%

SPX,
-0.30%

DJIA,
-0.39%

were rising in early trade, and pointing to potential new records after stronger-than-expected retail sales data.

Investors remain concerned about the highly contagious delta variant, which has rapidly spread worldwide. U.S. President Joe Biden will on Friday join Pacific Rim leaders, including China’s Xi Jinping and Russia’s Vladimir Putin in a virtual meeting to develop strategies to help economies rebound from the resurgent COVID-19 pandemic.

Meanwhile, as North America has endured recent soaring temperatures, Europe was dealing with deadly floods in western Germany, parts of Belgium and Luxembourg. German Chancellor Angela Merkel has pledged rapid help for torrential rains that have killed more than 90 and left hundreds missing in the western part of the country, as persistent rains have left rivers and reservoirs overflowing.

Ernst Rauch, chief climatologist at German reinsurer Munich Re
MUV2,
-0.59%
,
reportedly told Der Spiegel magazine on Friday that the year could be the most damaging since 2013 for 2013, and expects the country to continue to see damage from storms and natural disasters.

Economic data showed European Union car sales rose in June, but the pace slowed, according to data from the European Automobile Manufacturers’ Association. New-car registrations rose 10% year-over-year, but versus a gain of 53% in May.

Euro area annual inflation rate was 1.9% in June 2021, down from 2.0% in May. The number was in line with expectations. Elsewhere, eurozone exports dropped in May for the fifth straight month, even amid the easing of many coronavirus-related restrictions.

Shares of Puma
PUM,
-0.79%

fell 2%, after the German sporting-goods company raised full-year revenue and earnings guidance, after sales almost doubled in the second quarter.

From the luxury-goods sector, shares of Burberry
BRBY,
-5.58%

fell over 4%. The U.K. company reported a 90% rise in comparative store sales and a 26% rise in full-price comparable sales for the 13 weeks ended June 26, both compared with the year-ago period, driven by a strong rebound from the pandemic.

“A big obstacle waiting to trip up the company on this catwalk of recovery is the departure of CEO Marco Gobbetti. He has been seen as the turnaround czar for Burberry and investors are questioning the company’s ability to keep driving through the strategic turnaround without him in the front row,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, in a note to clients. Gobbetti is due to exit at the end of the year.

Cie. Financière Richemont
CFR,
-1.16%

reported sales jumped in the first quarter of the fiscal year, driven by jewelry and watch sales and a strong Americas performance. The Swiss company also said it would implement a change to the group management structure. Shares fell 0.9%.

Leading the decline on the Stoxx Europe 600, shares of Ericsson
ERIC,
-9.25%

ERIC.A,
-8.19%

dropped more than 9%. The telecommunications-equipment company announced an $8.3 billion multiyear 5G deal with Verizon Communications
VZ,
+0.05%

and posted a forecast-beating, second-quarter net profit that beat expectations, but reported weaker sales in China.

Ericsson previously warned that Sweden’s ban on certain Chinese gear could result in some retaliation, and said it is now “prudent to forecast a materially lower market share in mainland China for networks and digital services.”

Rio Tinto
RIO,
-4.23%

RIO,
-3.50%

said it shipped 12% less iron ore from its Australian mining hub in the second quarter of 2021 versus a year earlier, and that it expects annual exports to be at the low end of an earlier estimate, following above-average rainfall, operational shutdowns and COVID-19-fueled labor shortages. Shares of the world’s second-biggest miner fell 1.7%.

Airlines were higher after President Biden, in a meeting with Germany’s Merkel said that the U.S. should have an answer in a few days about European travel restrictions. Strict rules put in place under the former administration banned most European travelers from visiting the U.S. and the highly contagious delta variant could complicate matters some fear.

The travel sector was more positive, led by shares of InterContinental Hotels Group
IHG,
+1.48%
,
up over 3%. The company was upgraded to neutral from sell by analysts at UBS on Friday who said “recent sequential improvement in RevPAR is likely to be sustained and U.S. hotel construction projects might be bottoming.”

Shares of TUI
TUI1,
+3.16%

climbed 4%, while those of Deutsche Lufthansa
LHA,
+2.82%
,
Aeroports de Paris
ADP,
+2.64%

and International Consolidated Airlines
IAG,
+1.08%

were up between 1% and 2%.

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