European shares stabilise after worst week since 2008

Reuters March 2 | Updated on March 02, 2020

Pedestrians walk by the bull and bear sculpture in front of the Frankfurt stock exchange. -- Reuters

European shares steadied on Monday after their worst weekly showing since the 2008 financial crisis, on rising hopes that major central banks will step in to counter the impact of the coronavirus epidemic on global growth.

The pan-European STOXX 600 index rose 1.8 per cent by 0818 GMT, after a 12 per cent slump last week, with miners and oil & gas companies leading the gains.

Sentiment firmed as bleak factory activity data out of China fuelled hopes of more stimulus, even as new infections in the country declined.

However, the virus continues to spread elsewhere. The US reported its second death, while the UK reported a total of 36 cases as of Sunday. Italy, the worst-hit in Europe, saw the death toll rise to 34, five more than a day earlier.

Investors are betting that the US Federal Reserve will cut interest rates by 50 basis points as early as March, while the European Central Bank is expected to cut rates by a 10 basis point (bps) at the April meeting.

Among the top gainers were telecoms equipment maker Nokia, up 4.6 per cent after saying long-time Chief Executive Officer Rajeev Suri will step down in September.

Final readings of manufacturing activity in Europe for February are due later in the day.

Published on March 02, 2020

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