Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

European Stocks Come Closer to Correction as Virus Cases Mount

Stock MarketsFeb 27, 2020 09:26
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. European Stocks Come Closer to Correction as Virus Cases Mount

(Bloomberg) -- The sell-off ripping through European equity markets intensified on Thursday as the cases of coronavirus outside China continued to rise.

The region’s benchmark is nearing a correction, with the Stoxx Europe 600 Index now down 8.9% since last week’s record high. The measure slid 2.3% as of 8:12 a.m. in London, with basic resources and travel and leisure industry groups lower, after the U.S. reported its first case of coronavirus that doesn’t have ties to a known outbreak.

Equities are plunging as the spread of the epidemic fuels fears about the impact on global growth and corporate earnings. More coronavirus cases were reported in countries other than China for the first time, the World Health Organization said.

“Given the recent volatility, fear is the dominant factor,” said Guillermo Hernandez Sampere, head of trading at asset manager MPPM EK. “In a very short period, we went from all-time high celebrations to panic mode. It’s too early to ‘buy the dip’ in my view and I expect investors to stay on the sidelines or increase cash.”

European equities have now wiped out all the sharp gains made since late October. The Stoxx 600 is on track for its worst week since August 2011. Stocks in Italy, the heart of the outbreak in Europe, fell 2.2% on Thursday. Greek stocks, last year’s big winners, are heading for one of the worst performances among global equity benchmarks this month.

Travel stocks tumbled yet again, down 3.3%. The sector has plunged the most among industry groups since Feb. 19.

Anheuser Busch Inbev NV (NYSE:BUD)joined the chorus of companies warning about the impact of the epidemic, with the world’s largest brewer forecasting the steepest decline in quarterly profit in at least a decade due to the coronavirus. Its shares fell 5%.

“Investors should minimize their exposure to industrial commodities, luxury goods and European airlines,” said Seema Shah, chief strategist at Principal Global Investors. “We also favor quality stocks, especially large companies. “Defensive sectors such as utilities, real estate and health care are likely to do well in the equity markets compared to the broader markets.”

Seven companies including AstraZeneca Plc (NYSE:AZN), Barclays Plc (NYSE:BCS) and HSBC Holdings Plc (LON:HSBA) traded without the right to dividends today, shaving about 0.4 point off the Stoxx 600 and almost 28 points off the FTSE 100 Index.

European Stocks Come Closer to Correction as Virus Cases Mount
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email