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Coronavirus fears push Europe shares to a patch

UNITED STATES (OBSERVATORY NEWS) — European stocks posted their weakest closing level in more than four months on Thursday, to fall in a correction zone in light of a jump in the number of cases of Coronavirus outside China, fueling concerns about an economically devastating epidemic.

Investors usually consider a correction in a stock or index to be down 10 percent or more from a recent high.

The Stoxx 600 index of European shares fell 3.8 percent in the session, and fell more than ten percent from the record high reached on the nineteenth of February.

While strong earnings caused investors to catch their breath and stop selling on Wednesday, a sudden surge in cases outside China, especially in Italy, sent markets back lower.

Thursday’s sell-off caused more than 97 percent of the companies making up the Stoxx 600 index, while core resource stocks were among the worst-performing sectors as commodity prices tumbled in light of fears of continuing turmoil in global supply chains.

London-listed Evrax Mining was the sector’s worst performer after the company posted weak earnings for 2019.

Travel stocks also tumbled, while Evolution Gambling Group led the decline in gambling. And the sector fell about 15 percent this week, to record a decline in performance compared to the corresponding sectors by a wide margin.

Standard Chartered shares fell 3.5 percent after the bank said a major profit target would take time to meet as the epidemic added to adverse factors in China and Hong Kong. The broader banking sector came under pressure from a drop in bond yields.

The shares of Heuser-Busch Inbev, the world’s largest beer maker, fell nearly 11 percent, after forecasting weak growth in 2020, partly due to the outbreak.

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