(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window)
* STOXX 600 closes down 0.3%
* More drastic coronavirus curbs may be in the offing - analyst
* Julius Baer jumps on upbeat outlook
* NASA selects Nokia to build first cellular network on moon (Updates prices to close)
By Sruthi Shankar and Susan Mathew
Oct 19 (Reuters) - European shares ended lower on Monday as surging COVID-19 cases raised the possibility of further economic restrictions, outweighing optimism from signs of progress on a Brexit trade deal and hopes of fiscal stimulus in the United States.
As daily COVID-19 cases in Italy hit a new record over the weekend, the country approved shutting public squares from 9 p.m. to halt gatherings. In Spain, many regions toughened curbs as the country looked set to set breach 1 million cases this week. Wales imposed a two-week lockdown, Britain's government scientific adviser said the country needs to impose a three-week period of national lockdown. Wales, Spain, and Belgium all tightening restrictions further... we are seeing significant fears arise over the potential economic impact this could have upon the recovery," said Joshua Mahony, senior market analyst at online trader IG.
"The lockdown in Wales does highlight the potential path forward for others, with more localised action looking a precursor to more drastic measures."
A surging pound added to woes for London's FTSE 100 .FTSE led losses, down 0.6%. GBP/ .L
The currency rose after the European Union said it is ready to intensify talks towards a deal on future trade ties with Britain. major SAP SAPG.DE weighed on Germany's DAX .GDAXI , while France CAC 40 .FCHI turned to losses at close. Exchange operator Euronext ENX.PA resumed trading after it fixed a technical glitch that froze all transactions in Paris, Amsterdam, Brussels and Lisbon for more than three hours. pan-European STOXX 600 index .STOXX closed down 0.3% after trading flat in the second half. Hopes of a COVID-19 vaccine by year-end, and signs an agreement in Washington on a fiscal package could be reached soon, had buoyed sentiment in morning trade. MKTS/GLOB the top of STOXX 600 was Swiss wealth manager Julius Baer BAER.S which jumped 6% after it indicated an improvement in profitability for the first nine months of 2020. broader financial services sector .SXFP rose 1%, with Credit Suisse CSGN.S and UBS UBSG.S rising 4.4% and 3%, respectively.
European third-quarter earnings are forecast to recover from a pandemic-led slump, with analysts expecting companies on the STOXX 600 to report an average 36.7% drop, compared with a 51% drop in the previous quarter, according to Refinitiv data. NOKIA.HE posted its best session in over two months after it was selected by NASA to build the first cellular network on the moon. defence company Saab SAABb.ST sank 14.3% after it reported a fall in third-quarter profit and could not confirm its previous financial outlook for the year.
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