0I2R.L Share News (0I2R)

(Sharecast News) - Stocks in Europe got slammed again at the end of the week as investors rushed into the relative safety of government bonds, alongside big moves in the euro and crude oil futures.
"It's been another dreadful day for European stock markets, with the DAX taking out last month's lows, while the FTSE100 has slipped back to its lowest levels since July 2016," said Michael Hewson, chief market analyst at CMC Markets UK.

"As yields plunge across the world the coronavirus has effected a stampede for the exits in the fashion of someone shouting fire in a crowded theatre, as havens surge and yields plunge."

The pan-European Stoxx 600 finished down 3.67% at 366.80, alongside a 3.37% fall on the German Dax to 11,541.87 and a retreat of 4.14% to 5,139.11 for France's Cac-40.

In the background, the number of confirmed coronavirus cases in Italy hit 4,636 on Friday, up from 3,858 on the day before, amid reports that authorities were mulling placing Milan under quarantine.

Commenting on the fallout from the worldwide coronavirus outbreak, analysts at BofA Securities told clients to expect the onset of a global recession in March, with the key to whether its lasts months not weeks being the American consumer, adding that the easiest path to a recession remained a sharp fall in the prices of financial assets.

With policymakers starting to panic and given their new forecasts for earnings per share suggested that the 2,800-3,040 point range in the S&P 500 was a "good entry point," BofA added.

Euro/dollar was again vaulting higher as the number of virus cases in the US climbed as well, adding 0.6% to 1.1296, while Brent crude oil plummeted 8.6% to $46.02 a barrel after Russia rejected a call from OPEC for further oil output curbs.

The latter sent the Stoxx 600's Oil&Gas sector index down 5.45% but helped the Travel & Leisure sector index pare its losses to -2.05%.

Norwegian Air Shuttle plummeted 23% amid fears over the toll that the coronavirus would have on its balance sheet.

In parallel, SAS AB announced that it would cut routes and capacity as demand falls but said that the virus's impact on February traffic was "limited", but its shares ended the day 6% after having traded lower earlier.

IAG also reversed early selling while EasyJet nearly managed the same feat, thanks to the precipitous downdraft in oil prices.

Airbus stock ended the day 8% lower, at its session lows, after the jetmaker reported that it had received zero new orders for jets in February, although there had been no cancellations.

Tullow Oil was at the bottom of the pile on the Stoxx 600 on the back of the falling price of crude.

Italian toll-road operator Atlantia was down 5% amid reports regarding concerns in Italy about the precarious state of many of the countries ageing bridges.

German chipmaker Infineon was down 5% in the wake of reports that US officials had recommended against allowing its $10bn deal to acquire Cypress Semiconductor to go through.

On the economic front, Greece's national statistics office reported that the counrty's gross domestic product shrank at a quarter-on-quarter pace of 1.0% over the first three months of 2020.

In Germany meanwhile, the government reported a 5.5% month-on-month jump in factory orders for January (consensus: 1.5%), helped by a bounce back in orders for large capital goods including aerospace and bulk machinery and equipment.

"This is a ridiculous strong headline, though it's difficult to put too much weight on it. It reflects conditions before the Covid-19 outbreak [...] Very strong; it won't last, but every little helps at this point," says Claus Vistesen at Pantheon Macroeconomics.

ISTAT meanwhile reported that Italian retail sales in January were flat month-on-month.