Gold rallies to record and euro tops $1.17 while European travel stocks slump on Spain quarantine – MarketWatch

Passengers wearing a face mask or covering due to the COVID-19 pandemic, arrive at Heathrow airport, west London, on July 10, 2020.


daniel leal-olivas/Agence France-Presse/Getty Images

Gold surged to a record and the dollar weakened Monday while European travel stocks slumped.

As U.S. lawmakers debate another round of stimulus and concerns mount about a stalling economic recovery, gold futures
GOLD,
+1.60%

climbed over $32 an ounce. The euro
EURUSD,
+0.30%

traded above $1.17, having been as low as $1.08 as recently as May, as traders react to the new stimulus plan from the European Union and better economic data than the U.S.

Read more on gold futures.

“Those seeking both safety and a decent yield, only have one real option at the moment – with Treasury yields rooted near zero, and negative in real terms, and cash earning nothing. The ‘TINA’ theory – there is no alternative – is the final factor propelling the precious metal skyward,” said Michael Brown, senior market analyst at Caxton.

The German DAX
DAX,
+0.34%

rose while the French CAC 40
PX1,
-0.09%

and U.K. FTSE 100
UKX,
-0.16%

saw small losses in early action.

Down 1.5% last week, the Stoxx Europe 600
SXXP,
-0.06%

weakened 0.2%.

Futures on the Dow Jones Industrial Average
YM00,
+0.39%

rose 112 points.

Travel operator TUI
TUI,
-11.77%

fell nearly 9% and International Airlines Group
IAG,
-8.91%

and easyJet
EZJ,
-10.76%

each lost 8% as Britain over the weekend said it will quarantine visitors from popular holiday destination Spain due to rising coronavirus cases there.

Ryanair
RY4C,
-5.27%
,
which separately reported a €185 million loss for the June-ending quarter that had 99% of its traffic grounded, fell 7%.

“Tourism and summer activities will certainly remain a risk to be considered for European investors if mild measures, such as social distancing and the obligation to wear masks, do not prevent cases from rising. Investors fear renewed lockdowns, although any confinement measures in the close future are expected to be selective rather than a general halt in economic activity,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

SAP
SAP,
+2.99%

SAP,
-1.64%

rose 3.6% after saying it would seek an initial public offering for Qualtrics, the cloud software company it bought in 2018 for $8 billion, as it reported a rise in second-quarter profit.

AstraZeneca
AZN,
-0.12%

AZN,
+1.14%

was steady after saying it will pay Daiichi Sankyo Co.
4568,
+2.98%

up to $6 billion in a cancer drug deal.