European stocks ended sharply lower on Wednesday as disappointing economic data, rising coronavirus cases, tighter lockdown measures and worries about delay in vaccine supplies triggered heavy selling at several counters from across various sectors.
Global coronavirus cases surpassed 100 million, with Europe currently reporting a million new infections about every four days
Investors were looking ahead to the Federal Reserve's policy announcement, due later in the day, for clues on monetary stimulus in the world's largest economy.
The pan European Stoxx 600 slid 1.16%. The U.K.'s FTSE 100 ended down 1.3%, France's CAC 40 drifted down 1.16% and Germany's DAX ended lower by 1.81%, while Switzerland's SMI lost 0.55%.
Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Greece, Iceland, Ireland, Netherlands, Norway, Poland, Portugal, Russia, Spain, Sweden, Turkey and Ukraine ended with sharp to moderate losses. Finland bucked the trend and ended modestly higher.
In economic releases, a report from the DIW Institute said the German economy is set to contract in the first quarter due to strict restrictions related to Covid-19 pandemic.
Gross domestic product will contract 3% in the first quarter of 2021 after stagnation in the fourth quarter, the think tank estimated.
The hard lockdown will last until the end of February and then gradually be lifted, Claus Michelsen, an economic director at DIW Institute said. So there is a long and rocky road ahead for the German economy.
A survey from market research group GfK showed German consumer confidence is set to deteriorate in February under the strict lockdown restrictions. GfK said its forward-looking consumer sentiment index dropped 8.1 points to -15.6 in February from -7.5 in January. The expected reading was -7.9.
French consumer confidence index dropped more-than-expected to 92 in January from 95 in December, survey results from the statistical office Insee revealed. The expected level was 94.
U.K. shop prices decreased 2.2% year-on-year in January, after a 1.8% drop in the previous month hit by the renewed Covid-19 lockdown measures, data from the British Retail Consortium showed.
The International Monetary Fund raised its growth forecast for the global economy this year on Tuesday. The IMF now expects the global economy to grow 5.5% in 2021, a 0.3 percentage point increase from October's forecasts.
In the UK market, Fresnillo tumbled more than 13% after forecasting a fall in gold production. Glencore and Anglo American lost 6.75% and 6.2%, respectively. Evraz, Avast, Aveva Group, Polymetal International, Coca-Cola HBC, Natwest Group, Barclays, Lloyds Banking Group, Rio Tinto, M&G and Standard Chartered lost 2.5 to 5%.
Among the gainers, Pearson shares soared nearly 14%. Hargreaves Lansdown, British Land, Ocado Group, Land Securities, Next and British American Tobacco also ended with strong gains.
In the German market, Thyssenkrupp, Merck, Covestro, Bayer, Deutsche Post, Infineon Technologies, RWE, Deutsche Bank, Daimler, Adidas, Volkswagen and BMW lost 1 to 4%, while Lufthansa gained more than 4%.
In France, ArcelorMittal, BNP Paribas, STMicroElectronics, Saint Gobain, Societe Generale, Credit Agricole, Teleperformance, Sanofi and Michelin ended lower by 2 to 4%.
Unibail Rodamco zoomed 20%. Technip, Air France-KLM, Orange, Thales and Air Liquide gained 1 to 3.5%.
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