By Steve Goldstein, MarketWatch
European stocks slumped on Tuesday as worries over a spreading virus in China as well as weak guidance from Swiss banking giant UBS weighed.
The Stoxx Europe 600 /zigman2/quotes/210599654/delayed XX:SXXP +2.22% declined 0.75% to 420.79, with declines from luxury-goods producers that rely on Asia for demand. LVMH Moet Hennessy Louis Vuitton /zigman2/quotes/201350549/delayed FR:MC +1.42% , Burberry Group /zigman2/quotes/205386705/delayed UK:BRBY +2.56% and Compagnie Financiere Richemont /zigman2/quotes/203783259/delayed CH:CFR +2.64% each fell over 3%.
U.S. stock futures /zigman2/quotes/209948968/delayed ES00 +0.15% also were lower as American traders returned from the three-day break.
More than 200 people have been infected by a new coronavirus outbreak, and four have died, which a Chinese government official said can be spread from human to human. The spreading virus is reminiscent of the SARS outbreak in 2002 and 2003.
Of stocks in the spotlight, UBS shares /zigman2/quotes/206994749/delayed CH:UBSG +6.12% /zigman2/quotes/206172872/composite UBS +5.33% fell 5% on the Swiss banking giant’s downbeat guidance even as fourth-quarter results beat analyst estimates.
UBS forecast a cost-to-income ratio between 75% and 78% in 2022, versus guidance of 72% by the end of 2021. UBS also targeted a return on capital between 12% and 15% between 2020 and 2022, against a previous target of 17% through 2021.
EasyJet /zigman2/quotes/202825892/delayed UK:EZJ +3.99% shares rose 4.7% as the budget airline expects to narrow its first-half loss before tax and said its first-half revenue per seat at constant currencies will grow mid-to-high single digits, versus a previous expectation of low-to-mid-single-digit growth. Fiscal first-quarter revenue rose 9.9% to £1.425 billion.
The airline said it benefited from the collapse of rival Thomas Cook in September.