European stocks near three-month lows
A sell-off in global risk assets drove European equities to near three-month lows on Thursday, as the absence of fresh stimulus for the U.S. economy and a second wave of coronavirus cases raised fears of a slowing global recovery.
The pan-European STOXX 600 index fell 0.8%, recovering slightly after hitting its lowest level since June 26, while bourses in Frankfurt, London and Paris were down between 0.3% and 0.6%. Wall Street indexes suffered sharp losses overnight, led by technology stocks after U.S. Federal Reserve officials called for more government aid from the Congress, while reinforcing their stance of loose monetary policy.
European tech names were down 1.4%, while growth-sensitive sectors such as travel and oil & gas fell about 1.3%. France become the latest European country to reimpose curbs with the government unveiling a map of coronavirus “danger zones” and giving the hardest-hit local authorities days to tighten restrictions or risk having a state-of-health emergency declared there.
British cinema operator Cineworld slumped 13.7% as it swung to a loss and said it may have to raise more money if pushed to shut its theatres again due to government curbs on social gathering.
However, losses in German markets eased after an economist at the Ifo economic institute said the German industry is recovering and its export expectations have improved significantly.
Online payments company Adyen fell 1.4% after it said cofounder Arnout Schuijff would step down from its management board as of the 1 January. French utility Suez SA fell 4% after rival Veolia said the company will not rule out increasing the price it has offered for a stake owned by Engie. Suez sees Veolia’s bid plan as hostile and is working on finding a consortium of investors to put together a rival bid for Engie’s stake. However, the utilities and real estate indexes, among the so-called defensive sectors which tend to find favour during economic uncertainty, rose slightly.
This article was compiled by BOV Asset Management Limited, a member of the BOV Group. BOV Asset Management,TG Complex, Suite 2, Level 3, Brewery Str., Mriehel BKR 3000. Email: infoassetmanagement@bov.com Internet address: www.bovassetmanagement.com. BOV Asset Management is licensed by the MFSA.