* European shares buck bullish mood in Asia
* World stocks head for near 14% gain in 2020
* Dollar slips, heads for 7% fall this year
* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh
(Adds details, latest prices)
By Tommy Wilkes
LONDON, Dec 31 (Reuters) - Stocks fell in European trading
on Thursday as lockdowns and rising COVID-19 cases overshadowed
the optimism around the rollout of vaccines in the New Year,
while the dollar's descent accelerated to another
two-and-a-half-year low.
Trading volumes were thin, with many traders away on New
Year's Eve and major European markets closed. Where markets were
open, they failed to follow their Asian peers higher.
UK's FTSE 100 .FTSE fell 1.1% and France's CAC 40 .FCHI
by 0.1%. U.S. stock futures were flat or slightly higher ESc1 ,
ahead of the Wall Street open.
The MSCI World Index .MIWD00000PUS was flat on the day and
slightly below its record level as gains in Asia gave way to the
losses in Europe. The index is headed for a near 14% rise in
2020 after surging more than 60% from its March lows.
Despite a stimulus-charged rebound since the
pandemic-induced market slump in March, most European markets
have underperformed the United States and Asia, where a series
of record highs have been reached.
The pan-European STOXX 600 .STOXX , which was closed on
Thursday, recorded a 3.8% drop in 2020 as a rapid surge in
coronavirus cases and worries about Brexit curbed the wider
recovery in investor sentiment.
Still, despite rising COVID-19 case numbers and increasing
unemployment, investors are betting the rollout of vaccines in
2021 will unleash an economic rebound spurred by plentiful
fiscal and monetary cash.
There is a widely-held consensus among investors -- the
biggest consensus in years -- that stocks and emerging market
assets will rise in 2021 and the dollar and government bonds
will perform poorly.
"We still see growth slowing around the turn of the year and
the recovery will still face headwinds in the coming quarters,
but 2021 is shaping up to be better still than our already
strong global outlook—led by a stronger U.S.," JP Morgan
economists said in a research note.
Among the biggest developments in markets in 2020 has been
the drop in the dollar. On Thursday, it hit its lowest since
April 2018 and is now down 7.2% against a basket of currencies
=USD , its worst annual performance since 2017.
The dollar's weakness, driven by bets that the Federal
Reserve will keep interest rates very low, has helped rivals.
The euro has been a big beneficiary and is up 10% in 2020.
It fell 0.2% on Thursday at $1.2278 EUR=EBS .
The Chinese yuan ends the year at its strongest since
mid-2018, with the dollar down 6.5% versus the yuan in offshore
markets CNH=EBS .
Sterling GBP=D3 EURGBP=D3 extended its rally versus both
the dollar and the euro after Britain's markets watchdog granted
UK market participants the right to use platforms in the
European Union to trade swaps for up to three more months, in a
bid to avoid disruption. The pound soared in the run-up to Britain and the European
Union reaching a Brexit trade deal in Christmas Eve.
VACCINE ROLLOUTS NEEDED
Asian stock gains were led by Chinese blue chips .CSI300
after the announcement of a trade deal with the European Union.
Official data released Thursday also showed activity in
China's service and factory sector expanding in December.
Markets barely flickered at the news that China had approved
its first COVID-19 vaccine for general public use.
Gary Ng, an economist at Natixis in Hong Kong, said the
limited impact showed markets had become immune to such news.
"For the market to react more strongly in 2021, large-scale
(vaccine) rollouts with positive outcomes are needed," he said.
Bitcoin's rally paused BTC=BTSP at just under $29,000. The
world's largest cryptocurrency has almost quadrupled in value
this year amid heightened interest from bigger investors.
Oil prices, which have doubled since April but finish the
year more than 20% weaker, retreated as swelling supply
discouraged hopes for a swift rebound in economic activity and
energy demand.
U.S. West Texas Intermediate crude CLc1 shed 0.93% to
$47.95 a barrel and Brent LCOc1 was trading down 1.01% at
$51.11. O/R
Gold XAU= was little changed at $1,893 an ounce, putting
it on course for a 25% rise this year, its best showing since
2010 as investors looked to safe havens, protection against
inflation and as the dollar wilted.
Treasuries were little changed, with benchmark U.S. 10-year
yields US10YT=RR at 0.9265%.
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Emerging markets http://tmsnrt.rs/2ihRugV
World stocks index https://tmsnrt.rs/38SdvLJ
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