Europe stocks sink on fears coronavirus is spreading in Italy
European stocks were sharply lower Monday as investors focus on the continuing spread of the coronavirus and watch as Italy grapples with the largest outbreak outside of Asia.
The pan-European Stoxx 600 plunged 3.5% by mid-morning, with travel and leisure stocks tumbling 5.7% to lead losses as all sectors slid sharply into the red.
Coronavirus concerns continue to dominate headlines and in Europe, and there are widespread concerns over the spread of the virus in northern Italy. A fourth person infected with the coronavirus died in Italy on Monday, a regional official said, and more than 130 cases have been reported there since Friday. The government has placed a dozen towns in the north under quarantine and closed down schools, museums and cinemas while other public events, including soccer matches, have been cancelled and the Venice Carnival cut short.
Iran and South Korea have also seen a sharp rise in cases of the virus. Meanwhile in China, the center of the epidemic, the National Health Commission reported an additional 150 deaths and 409 new confirmed cases as of Feb. 23.
U.S. Treasury Secretary Steven Mnuchin told CNBC Sunday that U.S. officials will have a better idea of how the coronavirus outbreak will impact the economy in “three or four weeks.”
In U.S. politics, Bernie Sanders scored a clear victory in the weekend’s Nevada caucuses making him a front-runner for the Democratic presidential nomination.
On the data front, a closely-watched German business climate index from the Ifo Institute on Monday showed business sentiment in the country improving in February, rising to 96.1 from 96.0 in January, to defy consensus forecasts for a fall to 95.3.
Airline stocks took the worst of Monday’s losses. EasyJet stock plummeted 11.9% by mid-morning and Ryanair 10.5%, closely followed by a 9.4% drop for Air France KLM
British Airways owner International Consolidated Airlines Group shed 7.3% while Lufthansa fell 6.4%. Tour operator Tui tumbled 7.9%.