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European stocks tumbled on Monday, with airlines, mining stocks and luxury-goods companies hit hard as the death toll and number of infected from China’s coronavirus ramped up over the weekend.
The Stoxx Europe 600 index SXXP, -2.06% fell 1.7% to 416.48, headed for its worst one-day fall since August last year. The index closed Friday with a near 0.9% gain, but was likely playing catch-up on Monday as Wall Street stocks closed lower on Friday over coronavirus worries.
The French CAC 40 index PX1, -2.33% fell 1.9% to 5,908.53, the German DAX 30 DAX, -2.22% 1.7% to 13,343.17 and the FTSE 100 UKX, -2.40% 2% to 7,426.78. The U.K. will finally exit the European Union at midnight on Friday more than three years after the Brexit vote.
Economic data from Germany showed the January Ifo Business Climate index came in at 95.9, missing the consensus estimate for 97, according to Dow Jones Newswires.
That’s as U.S. stock futures fell sharply, with Dow futures YMH20, -1.53% indicating a near 1% drop when trading begins later. At the heart of market concerns are several headlines about the rapidly spreading coronavirus, which usually causes respiratory illness.
China extended this week’s Lunar New Year holiday, just one of several measures aimed at halting the spread of the coronavirus, as the death count rose to at least 80, and the number of those infected neared 3,000. Several countries have reported confirmed infections, including the U.S., France and Japan.
Questions are being raised over the effectiveness of the quarantine on places like Wuhan, China, believed to be the epicenter of the outbreak. A worrying detail emerged as Wuhan’s mayor Zhou Xianwang said that five million people left the city before the travel ban was imposed.
Travel and luxury-goods companies again had big declines as analysts began pondering the economic impact of the virus. Fears of world-wide travel being hit left airlines sharply lower, with Deutsche Lufthansa LHA, -4.75%, EasyJet EZJ, -5.23%, Air France-KLM AF, -6.57% and International Consolidated Airlines Group IAG, -6.02% all down over 4%.
With wealthy Chinese consumers a major market for the luxury-goods sector, Burberry Group BRBY, -4.53% fell 4%, Kering KER, -3.99% dropped 3% and Cie. Financière Richemont CFR, -3.25% slid 2%. LVMH Moët Hennessy — Louis Vuitton MC, -3.56% was down 3.7%.
Mining stocks, extremely sensitive to the Chinese economy as the country is a big purchaser of natural resources, were another big losing sector. Shares of Evraz EVR, -3.90% slid over 5%, with Antofagasta ANTO, -4.57%, BHP Group BHP, -4.52% and Glencore down around 4% each.
Shares of major oil companies dropped as crude prices slid on concerns about how the virus might impact China’s economy and weaken its demand for that commodity as well. Shares of Total FP, -2.03% TOT, -0.74% slid 1.6% and BP BP, -0.18% BP, -2.21% lost 2%.
Banks on the decline included heavily-weighted HSBC Holdings HSBA, -3.61% HSBC, -0.53%, down 3.3%, and Banco Santander SAN, -1.55% SAN, -2.02%, which fell 1%.
