European shares slump to 2012 lows


By Ritu,

Capital Sands

European shares tumbled more than 8% on Monday as the coronavirus pandemic raged through much of Europe, with dramatic monetary easing by global central banks failing to reassure investors about its growing economic damage.

The pan-European STOXX 600 fell 8.2% to its lowest since November 2012, with bourses in France  and Spain  leading losses as the two countries joined Italy in enforcing a national lockdown.

Airlines and holiday operators including TUI , EasyJet , British-Airways owner IAG  and Air France – KLM  were among the biggest decliners on the STOXX 600 as the pandemic brought global travel to a standstill.

The wider travel and leisure index  plunged more than 12%. Europe’s fear gauge jumped to a record high of 87.90.

“The issue for investors is that the virus’ economic impact is still not known – if this is a one-month event or a one-year event, and how deep the cutback in consumer spending is going to be,” said Rick Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey.

The U.S. Federal Reserve slashed interest rates to near zero in its second emergency move this month and pledged hundreds of billions of dollars in asset purchases, saying the epidemic was having a “profound” impact on the economy.

Central banks in Japan, Australia and New Zealand followed with their own measures, but could not stem a slide in global stocks. S&P 500 futures fell 4.77% to their daily down limit shortly after resuming trading on Sunday night.

The benchmark European index has now lost more than a third of its value since hitting a record high mid-February, with declines made worse by a crash in oil prices and the European Central Bank’s decision to hold interest rates last week.

Latest economic data from China showing factory production plunging at its sharpest pace in 30 years has also re-ignited fears of a global recession as the pandemic paralyses supply chains and crushes business sentiment.

Europe’s banks index fell about 9.9%, with French banks Natixis and SocGen  giving up between 14.1% and 12.6%.

Credit Suisse plummeted 12% to a record low after a report that U.S. prosecutors were investigating the bank’s role in a $2 billion Mozambique corruption case.

Leave a Reply

Your email address will not be published. Required fields are marked *

Next Post

Taiwan central bank seen cutting rates as pandemic hits growth: Reuters poll

By Administrator_India Capital Sands Taiwan’s central bank is expected to cut its policy rate for the first time since 2016 as the coronavirus threatens the island’s export-reliant economy, which is a key part of global technology supply chain. The cut would follow a rush by global central banks to loosen […]

Subscribe US Now

Error: Your Requested widget " newsletterwidget-2" is not in the widget list.
  • [do_widget_area fullwidth-homepage-sidebar]
    • [do_widget_area sidebar-1]
      • [do_widget id="search-2"]
      • [do_widget id="recent-posts-2"]
      • [do_widget id="archives-2"]
      • [do_widget id="categories-2"]
    • [do_widget_area widgets_for_shortcodes]
      • [do_widget id="newsletterwidget-2"]
    • [do_widget_area wp_inactive_widgets]