UPDATE 2-European shares sink on lockdown concerns as virus cases surge

  • Reuters
  • Stock Market News
UPDATE 2-European shares sink on lockdown concerns as virus cases surge
Credit: © Reuters.

(For a live blog on European stocks, type LIVE/ in an Eikon news window)

* France imposes curfew, other European nations shut schools

* Autos, energy, insurance sectors shed more than 2%

* Traders await Brexit update as EU summit begins

* Ryanair slides on plans to cut winter capacity (Updates to close)

By Sagarika Jaisinghani

Oct 15 (Reuters) - European shares sank on Thursday as a resurgence in COVID-19 cases across the continent and fading hopes for more U.S. fiscal stimulus before the presidential election dented demand for equities globally.

The pan-European STOXX 600 index .STOXX fell 2.1% in its worst day in more than three weeks, with autos .SXAP , insurance .SXIP and energy .SXEP stocks tumbling more than 2%.

Bank shares .SX7P tracked a decline in bond yields, shrugging off signs of a pickup in M&A activity after a report said Italy's Banco BPM BAMI.MI and France's Credit Agricole CAGR.PA had signed a confidentiality agreement in a first step towards formal talks over a possible merger. are unnerved by what's going on with COVID-19 and how that is negatively impacting jobs and the ability for many businesses to succeed," said Russ Mould, investment director at AJ Bell.

"It's becoming more apparent that the pandemic could still be raging well into 2021 and so economic prospects have become even more clouded."

European stock markets bounced from the coronavirus lows hit in March on a raft of global stimulus, but sentiment has recently taken a hit from the surge in infections as well as signs of a slowing economic rebound.

France has imposed curfews and other European nations are closing schools and cancelling surgeries in an attempt to contain the resurgence ahead of the winter season. in France .FCHI , Italy .FTMIB , Spain .IBEX and Germany .GDAXI fell between 1.4% and 2.8%.

The UK's FTSE 100 was down 1.7% as the government imposed tighter restrictions in London, while investors looked for signs of progress towards a Brexit trade deal at the two-day European Union summit that began on Thursday. .L

EU leaders said agreeing a "fair" new partnership with Britain was "worth every effort" but that the bloc would not compromise at any cost and was ready for an abrupt split in trade worth a trillion euros every year. not in anyone's interest if the UK leaves the EU without a deal and markets are so far leaning towards an 11th-hour Brexit agreement," said Hussein Sayed, a market strategist at FXTM.

In company news, Swiss drugmaker Roche ROG.S shed 3.5% even as it posted record revenue in its diagnostics division that offset declining drug sales and kept it on track to meet its full-year 2020 targets. RYA.I fell 4.3% as it said it would cut its planned winter capacity by a third due to the wave of travel restrictions imposed by European governments.

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