UPDATE 2-European stocks hit one-month low as virus fears dominate

  • Reuters
  • Stock Market News
UPDATE 2-European stocks hit one-month low as virus fears dominate
Credit: © Reuters.

(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window)

* Miners hit by slew of rating downgrades

* HSBC surges on signalling overhaul

* BP reverses gains, oil sector at 7-month low (Updates to close)

By Sruthi Shankar and Susan Mathew

Oct 27 (Reuters) - European stocks extended losses on Tuesday as worries about the economic fallout of tighter coronavirus restrictions on the continent overshadowed some better-than-expected earnings reports.

The pan-European STOXX 600 index .STOXX fell 1% to a one-month low, on rising infections in the United States and Europe and fading hopes of a U.S. stimulus package before the presidential election. MKTS/GLOB

Focus will now be on Thursday's meeting of the European Central Bank for clues on monetary stimulus for the bloc.

"The ECB is widely expected to stand pat until the next meeting. Macro forecasts won't be updated until the December 10 meeting, but the bank will have to acknowledge the deteriorating outlook now," said Win Thin, global head of strategy at Brown Brothers Harriman.

"There's a small risk of more jaw boning against the stronger euro."

Germany's DAX .GDAXI shed 0.9% to hit four month lows, while France's CAC 40 .FCHI fell 1.8% to a one-month trough as the country grappled with a runaway infection rate. Chancellor Angela Merkel is planning a "lockdown light" in Europe's largest economy that would mainly focus on the closure of bars and restaurants to slow down a second wave of infections, newspaper Bild reported. on the UK's FTSE 100 .FTSE were limited by a 3.4% jump in Europe's biggest bank HSBC HSBA.L after the lender signalled a pandemic-induced overhaul of its business model, accelerating plans to shrink in size and slash costs. shares in oil major BP BP.L fell 2.1%. The company swung back to a small profit in the third quarter, but also warned of pandemic-related uncertainties. Europe's oil and gas sector index .SXEP touched its lowest level in seven months.

Spanish bank Santander SAN.MC closed down 1.3% as it tracked broader negative investor sentiment in the market. It had earlier in the day logged gains of up to 5% after saying it expects 2020 core profit to beat market expectations, helped by additional cost savings of 1 billion euros. IBEX .IBEX index fell 2.1%, also on worries about the economic impact of coronavirus-related curbs. earnings from Europe remain largely positive. Out of the 27% of the STOXX 600 companies that have reported so far, 73% have beat profit expectations, according to Refinitiv data.

French consulting and IT services provider Capgemini CAPP.PA jumped 2.1% after confirming its full-year targets. group Swedish Match SWMA.ST climbed 3.5% as it reported a bigger-than-expected rise in quarterly profit on the back of higher sales of smokeless products. .SXPP fell 1.4%, dragging markets lower, after Liberum analysts downgraded stocks of Rio Tinto RIO.L , Antofagasta ANTO.L and KAZ Minerals KAZ.L .

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