(Repeats story published late on Tuesday)
LONDON, Jan 28 (Reuters) - A whopping $200 billion was wiped
from European stocks at the start of this week as the deadly
coronavirus prompted investors to cut back exposure to companies
with a strong presence in China, the world's fastest-growing
consumer market.
The plunge on Monday saw European luxury goods makers,
airlines and miners among the stocks hit hardest as the outbreak
led to ramped-up travel bans, business shutdowns and extended
Lunar New Year holidays.
Hundreds of millions of people have been preparing to travel
for the Chinese holidays, stoking concerns infection rates may
accelerate during the period - which is also a peak retail
season in China and overseas.
The virus - which Chinese President Xi Jinping has described
as a "devil" - has had a bigger impact on European companies
than their U.S. peers due to their high revenue exposure to
China.
Some analysts have drawn comparisons with SARS, a deadly
virus in 2002-2003, but the read across is limited as China's
share of global gross domestic product has quadrupled since then
to 16%.
Investors have singled out the biggest names in Europe's
fashion industry, including France's LVMH, Italy's
Moncler and Britain's Burberry, as proxies
for the coronavirus outbreak. Chinese consumers have become the
sector's main growth engine over the past decade.
In a research note published on Tuesday, UBS analysts said a
30% drop in Chinese demand, their worst-case scenario, was
likely to hit the sector's earnings by as much as 7% in 2020.
Meanwhile, early data showed civil air travel in China
dropped 41.6% on the first day of Lunar New Year due to travel
curbs. In Europe, shares of long-haul operators Air France
and Lufthansa were among the worst hit.
In the hospitality sector, Intercontinental Hotels Group
and Accor were also beaten down.
Topping it all, the non-consumer facing mining sector was
the hardest hit in Europe, falling 7% on concerns that the
coronavirus will cut China's gigantic appetite for commodities.
The graphic below shows how Europe's miners have among the
biggest revenue exposures to China.
(Reporting by Julien Ponthus, Thyagaraju Adinarayan, Joice
Alves and Danilo Masoni; Editing by Pravin Char)
