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European Stocks Close Lower As Rising Virus Cases Trigger Growth Worries

(RTTNews) – European stocks closed notably lower on Monday amid fears of fresh disruptions across supply chains globally following tighter restrictions in Europe amid rapidly surging Omicron Covid-19 cases.

Several countries, including France and Austria have tighted travel restrictions. Paris has canceled its New Year’s Eve firework celebration, while Germany, which has ruled out a Christmas lockdown, has warned a fifth wave could no longer be stopped.

French Prime Minister Jean Castex has warned that the Omicron variant is “spreading at lightning speed” and that it should be the dominant variant by the start of next year. The country has imposed restrictions on travelers from the United Kingdom.

Worries about the deadlock over U.S. President Joe Biden’s $1.75 trillion investment bill weighed as well on sentiment.

The pan European Stoxx 600 shed 1.38%. The U.K.’s FTSE 100 lost 0.99%, Germany’s DAX declined 1.88% and France’s CAC 40 ended 0.82% down, while Switzerland’s SMI ended lower by 0.99%.

Among other markets in Europe, Austria, Denmark, Finland, Greece, Iceland, Ireland, Netherlands, Norway, Portugal, Russia, Spain, Sweden and Turkey closed with sharp to moderate losses.

Belgium and Poland ended marginally down, while Czech Republic edged up slightly.

Shares of oil companies tumbled as oil prices plunged on worries that a rise in Omicron Covid-19 cases would stall economic growth and dent fuel demand.

In the UK market, Antofagasta and Informa ended lower by 5.5% and 5.3%, respectively. Darktrace, Prudential, ABRDN, Smith (DS), M&G, Rolls-Royce Holdings, Fresnillo, BP and Smurfit Kappa Group lost 3 to 4.7%.

Scottish Mortgage, Barratt Developments, Vodafone Group, Rio Tinto, Smith & Nephew, Evraz, ICP and CRH also declined sharply.

Rentokil Initial climbed 6.5%. Royal Mail, Sage Group and Tesco gained 1 to 1.5%.

In the French market, WorldLine declined more than 6.5%. Technip, Renault, ArcelorMittal, Airbus, Faurecia, Safran, Michelin and Publicis Groupe lost 1 to 4%.

Shares French commercial real estate company Unibail-Rodamco-Westfield ended more than 2% down. The company announced a deal to sell its Solna Centrum, a metro station and shopping mall in Stockholm, to Alecta Fastigheter, an arm of Swedish pension fund Alecta, for 2.8 billion Swedish Krona or around 272 million euros.

In Germany, Porsche Automobil, Munich RE, Linde, Adidas, Deutsche Wohnen, Bayer, HeidelbergCement, SAP, MTI Aero Engines, Fresenius, Siemens, Daimler, Volkswagen and Deutsche Bank lost 2 to 4%.

Merck gained about 2.1%. HelloFresh, Qiagen and E.ON posted moderate gains.

Novo Nordisk A/S plummeted 11.7%. The Danish drug maker late on Friday announced that manufacturing snags at a contract supplier will make it unable to meet demand in the U.S. for its blockbuster obesity drug Wegovy.

In economic news, The euro area current account surplus remained unchanged in October, data from the European Central Bank showed. The current account surplus came in at EUR 18 billion in October, unchanged from September.

In twelve months to October, the current account surplus totaled EUR 311 billion or 2.6 percent of GDP, up from EUR 186 billion or 1.6 percent of GDP a year earlier.

UK manufacturers reported strong growth in demand in December, broadly unchanged from last month’s record high pace, the Industrial Trends Survey from the Confederation of British Industry showed on Monday.

The order book balance came in at +24% in December, slightly down from +26% in November. This was much better than the long-run average of -13%.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.