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March 18, 2020, 9:38 a.m. EDT

European stocks losses intensify as investors weigh up stimulus plans and oil slides

Drugmakers and oil companies slump as telecoms rise

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By Barbara Kollmeyer, MarketWatch


Reuters
Some merchants from the Porta Palazzo market, Turin, improvise a flash mob by singing the Italian anthem and waving Italian flags to celebrate the 159th anniversary of the unification of Italy on March 17, 2020.

Losses compounded for European stock markets on Wednesday, as oil prices slumped and investors fretted that plans by governments to prevent economic collapse from the coronavirus pandemic are lacking.

The Stoxx Europe 600 index /zigman2/quotes/210599654/delayed XX:SXXP +0.26%  fell 4.8% to 276.97, after closing up 2.3% on Tuesday. The German DAX 30 index /zigman2/quotes/210597999/delayed DX:DAX +0.11%  slumped 5.4%, the French CAC 40 index /zigman2/quotes/210597958/delayed FR:PX1 +0.02%  dropped 5.6% and the FTSE 100 index /zigman2/quotes/210598409/delayed UK:UKX +0.05%  dropped nearly 5%.

Losses were less pronounced in Spain and Italy, where the IBEX 35 index /zigman2/quotes/210597995/delayed XX:IBEX +0.27%  and the FTSE MIB Italy index /zigman2/quotes/210598024/delayed IT:I945 +0.83%  fell 3% each.

That is as Dow Jones Industrial Average futures /zigman2/quotes/210407078/delayed YM00 +0.0088%   hit the lower limits of trading , where they have remained for hours, down 821 points, or nearly 4%, to 20,039.

Fresh losses came after Tuesday’s upbeat session, as global governments announced pledges to shore up economies against the coronavirus pandemic. But investors remained jittery that global leaders are doing enough. U.S. Treasury Secretary Steven Mnuchin warned late on Tuesday that the U.S. jobless rate could climb to 20% without government action, Bloomberg reported.

The EU announced it will curb most foreign travel for 30 days to stop the virus’s spread, and the U.K. may this week announce its own emergency measures to close ports and airports.

The U.K. announced an unprecedented £330 billion ($397 billion) package to protect businesses and measures to support individuals hit by the pandemic. Measures have also been announced in hard-hit countries like Italy and Spain, which on Tuesday announced a €200 billion relief package to help businesses and individuals.

U.S. stocks rebounded on Tuesday, following White House support for an economic stimulus plan and the Federal Reserve’s moves to provide short-term funding for businesses affected by the coronavirus outbreak.

Read: Trapped in no-man’s-land of coronavirus restrictions, some of Britain’s small businesses are wasting away

The biggest drain on markets was coming from tumbling oil prices, which fell to a 17-year low on Wednesday.

West Texas Intermediate crude for April delivery /zigman2/quotes/211629951/delayed CL.1 -0.38% on the New York Mercantile Exchange slid $1.68, or 6.2%, to $25.27 a barrel after hitting its lowest level since April 2003. May Brent crude dropped $1.07, or 3.8%, at $27.66, after trading at its weakest since January 2016.

Oil has broken the oil-supply glut support of $25.06, which previous provided a safety net, said Naeem Aslam, chief market analyst at AvaTrade, in a note to clients. “The selloff is extremely intense now and if Saudi Arabia and Russia don’t get their act together, we could see it falling all the way to $22,” he said, in reference to the oil-price war between those countries that has routed oil prices.

Shares of BP /zigman2/quotes/207305210/composite BP +0.19%   /zigman2/quotes/202286639/delayed UK:BP +1.05%  and Royal Dutch Shell Group   made clear the pain being felt by the sector, with those shares down over 8% each. Airlines again took a huge nosedive, with easyJet /zigman2/quotes/202825892/delayed UK:EZJ -1.51%  sliding 17%.

Telecommunications companies were among the gainers in Europe, with Telefónica /zigman2/quotes/207034643/composite TEF +0.79%   /zigman2/quotes/200416613/delayed ES:TEF +0.87%  up 7.7% and Orange /zigman2/quotes/201008076/delayed FR:ORA -0.10%  up 6%.

Drugmakers were under pressure, with shares of Roche Holding /zigman2/quotes/206324342/delayed CH:ROG +0.12%  down over 5%, AstraZeneca /zigman2/quotes/203048482/delayed UK:AZN -0.21% , /zigman2/quotes/200304487/composite AZN -0.70%  Sanofi /zigman2/quotes/201967021/composite SNY -0.66% /zigman2/quotes/206928357/delayed FR:SAN -0.19%  and GlaxoSmithKline /zigman2/quotes/209463850/composite GSK -0.11%   /zigman2/quotes/200381158/delayed UK:GSK +0.34%  all posting losses of 4% or more.

On the upside, grocers were climbing as individuals continue to put emphasis on stocking up while lockdowns spread across Europe. Shares of Marks & Spencer Group /zigman2/quotes/206225481/delayed UK:MKS +0.45% rose 11%, J. Sainsbury /zigman2/quotes/206038250/delayed UK:SBRY +5.47% climbed 10% and Wm Morrison Supermarkets  rose 8%.

/zigman2/quotes/210599654/delayed
XX : STOXX
455.17
+1.19 +0.26%
Volume: 0.00
Jan. 27, 2023 11:03p
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/zigman2/quotes/210597999/delayed
DAX
DX : Xetra Indices
15,150.03
+17.18 +0.11%
Volume: 0.00
Jan. 27, 2023 6:30p
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/zigman2/quotes/210597958/delayed
FR : France: Euronext Paris
7,097.21
+1.22 +0.02%
Volume: 68,167
Jan. 27, 2023 6:05p
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/zigman2/quotes/210598409/delayed
UK : FTSE UK
7,765.15
+4.04 +0.05%
Volume: 568,906
Jan. 27, 2023 4:56p
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/zigman2/quotes/210597995/delayed
XX : Spain: Madrid
9,060.20
+24.60 +0.27%
Volume: 0.00
Jan. 27, 2023 5:38p
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/zigman2/quotes/210598024/delayed
IT : Borsa Italiana
26,435.75
+218.19 +0.83%
Volume: 0.00
Jan. 27, 2023 5:35p
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/zigman2/quotes/210407078/delayed
US : U.S.: CBOT
$ 34,049.00
+3.00 +0.0088%
Volume: 140,151
Jan. 27, 2023 3:59p
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/zigman2/quotes/211629951/delayed
US : U.S.: Nymex
$ 79.38
-0.30 -0.38%
Volume: 349,036
Jan. 27, 2023 4:59p
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/zigman2/quotes/207305210/composite
US : U.S.: NYSE
$ 36.32
+0.07 +0.19%
Volume: 8.45M
Jan. 27, 2023 4:00p
P/E Ratio
N/A
Dividend Yield
3.73%
Market Cap
$108.92 billion
Rev. per Employee
$3.38M
loading...
/zigman2/quotes/202286639/delayed
UK : U.K.: London
489.30 p
+5.10 +1.05%
Volume: 28.24M
Jan. 27, 2023 4:35p
P/E Ratio
N/A
Dividend Yield
3.97%
Market Cap
£88.14 billion
Rev. per Employee
£2.66M
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/zigman2/quotes/202825892/delayed
UK : U.K.: London
507.20 p
-7.80 -1.51%
Volume: 4.35M
Jan. 27, 2023 4:35p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
£3.89 billion
Rev. per Employee
£413,519
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/zigman2/quotes/207034643/composite
US : U.S.: NYSE
$ 3.84
+0.03 +0.79%
Volume: 1.20M
Jan. 27, 2023 4:00p
P/E Ratio
270.42
Dividend Yield
3.02%
Market Cap
$21.76 billion
Rev. per Employee
$410,097
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/zigman2/quotes/200416613/delayed
ES : Spain: Madrid
3.48
+0.03 +0.87%
Volume: 48.43M
Jan. 27, 2023 5:38p
P/E Ratio
124.32
Dividend Yield
6.89%
Market Cap
€20.07 billion
Rev. per Employee
€378,944
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/zigman2/quotes/201008076/delayed
FR : France: Euronext Paris
9.55
-0.01 -0.10%
Volume: 4.47M
Jan. 27, 2023 5:35p
P/E Ratio
6.01
Dividend Yield
7.33%
Market Cap
€25.38 billion
Rev. per Employee
N/A
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/zigman2/quotes/206324342/delayed
CH : Switzerland: SWX
CHF 289.35
+0.35 +0.12%
Volume: 1.09M
Jan. 27, 2023 5:31p
P/E Ratio
16.37
Dividend Yield
3.21%
Market Cap
CHF237.08 billion
Rev. per Employee
CHF637,961
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/zigman2/quotes/203048482/delayed
UK : U.K.: London
10,622.00 p
-22.00 -0.21%
Volume: 1.09M
Jan. 27, 2023 4:35p
P/E Ratio
96.85
Dividend Yield
2.09%
Market Cap
£164.62 billion
Rev. per Employee
£426,154
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/zigman2/quotes/200304487/composite
US : U.S.: Nasdaq
$ 65.53
-0.46 -0.70%
Volume: 3.18M
Jan. 27, 2023 4:00p
P/E Ratio
100.38
Dividend Yield
2.17%
Market Cap
$203.43 billion
Rev. per Employee
$544,657
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/zigman2/quotes/201967021/composite
US : U.S.: Nasdaq
$ 48.49
-0.32 -0.66%
Volume: 1.06M
Jan. 27, 2023 4:00p
P/E Ratio
16.31
Dividend Yield
2.60%
Market Cap
$121.60 billion
Rev. per Employee
$474,871
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/zigman2/quotes/206928357/delayed
FR : France: Euronext Paris
89.55
-0.17 -0.19%
Volume: 1.67M
Jan. 27, 2023 5:39p
P/E Ratio
16.98
Dividend Yield
3.72%
Market Cap
€112.17 billion
Rev. per Employee
€421,366
loading...
/zigman2/quotes/209463850/composite
US : U.S.: NYSE
$ 35.30
-0.04 -0.11%
Volume: 3.48M
Jan. 27, 2023 4:00p
P/E Ratio
4.34
Dividend Yield
5.67%
Market Cap
$70.92 billion
Rev. per Employee
$486,707
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/zigman2/quotes/200381158/delayed
UK : U.K.: London
£ 1,410.00
+4.80 +0.34%
Volume: 4.89M
Jan. 27, 2023 4:35p
P/E Ratio
4.20
Dividend Yield
0.04%
Market Cap
£57.39 billion
Rev. per Employee
£378,097
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/zigman2/quotes/206225481/delayed
UK : U.K.: London
146.20 p
+0.65 +0.45%
Volume: 3.63M
Jan. 27, 2023 4:35p
P/E Ratio
9.48
Dividend Yield
0.00%
Market Cap
£2.87 billion
Rev. per Employee
£170,941
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/zigman2/quotes/206038250/delayed
UK : U.K.: London
252.50 p
+13.10 +5.47%
Volume: 44.56M
Jan. 27, 2023 4:35p
P/E Ratio
10.36
Dividend Yield
5.47%
Market Cap
£5.88 billion
Rev. per Employee
N/A
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Barbara Kollmeyer is an editor for MarketWatch in Madrid. Follow her on Twitter @bkollmeyer.

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