BUSINESS European stock tumble at open on virus curb fears

BUSINESS

European stock tumble at open on virus curb fears

AFP

17:21, October 28, 2020

A man rides a motorbike near the National Assembly during a curfew in Paris, France, Oct. 17, 2020. ( File photo: AP)

European stock markets tanked at the open on Wednesday as investors fretted over speculation about the imminent introduction of tighter lockdown measures to combat soaring coronavirus infection rates, dealers said.

In initial deals, the benchmark Paris CAC 40 shares index nosedived 3.2 percent to 4,579.89 points, Frankfurt's DAX 30 tumbled 2.9 percent to 11,709.39 and London's FTSE 100 sank 2.2 percent to 5,605.59. Other markets were also down sharply.

"The double whammy of fears of further lockdowns crimping any tentative economic recovery in the UK and Europe, and a follow through of overnight weakness from the US based partly on the lack of further stimulus, have had a negative impact on investor sentiment," Interactive Investor analyst Richard Hunter told AFP.

The fresh surge in coronavirus cases across the United States and Europe weighed on sentiment, while investors have essentially given up on the chances of a new stimulus out of Washington.

European leaders are being forced to revert to strict, economically damaging measures to control the spread of the virus as some record a spike in deaths and new cases.

French President Emmanuel Macron is to address the nation on Wednesday evening to present tougher restrictions to counter an alarming surge in Covid-19 cases as doctors warned many hospitals are just days away from being overrun with patients.

German Chancellor Angela Merkel is meanwhile seeking drastic new curbs, including fresh shutdowns hitting leisure, sports and the food and drink sectors, in crisis talks with Germany's regional leaders to save the Christmas holiday season.

"It is becoming increasingly apparent that rising infection rates across Europe are now translating into a rise in hospitalisations, as well as a rising death count, with both the UK and France posting their highest fatality levels since May as the second coronavirus wave continued to spread across Europe," said CMC Markets analyst Michael Hewson.

"Concerns about a second national lockdown in France are also rising ahead of a scheduled national address later this evening by French President Emmanuel Macron.

"In Germany it is also being reported that Chancellor Merkel is proposing the closure of bars and restaurants for one month, in a move that could well last a lot longer as the weather gets colder."

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