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European stocks fall and Dow futures slide 400 points as rising COVID-19 cases need to cause more restrictions

People wear protective masks while shopping at an outdoor market in the Neucoin district during the second wave of the coronavirus pandemic on October 27, 2020 in Berlin, Germany.

Getty images

European stocks fell for a third straight session on Wednesday, with US stock futures also slipping as investors juggled another day of lucrative gains and prepared for more restrictions stemming from the continent’s growing coronavirus cases.

The Stoxx Europe 600 SXXP Index,
fell 2.3% after closing nearly 1% lower on Tuesday. The German DAX DAX,
decreased by 3%, the French CAC 40 PX1,
over 3% and FTSE 100 UKX,
fell by 2.1%.

Wall Street also reported more losses with the Dow YM00 futures,
down by over 400 points. Shares ended mostly lower on Tuesday, a day after their biggest drop in a month, as rising COVID-19 cases and abandoned hopes for an election stimulus plan hit investors. The US presidential election is just a week away

Read: A huge bubble has already popped up, says David Einhorn

French President Emmanuel Macron may announce new restrictions in a televised address on Wednesday, The Wall Street Journal reported. France has become one of the worst affected countries in Europe, as the second wave of the virus has spread across the continent.

German Chancellor Angela Merkel may also announce new traffic restrictions on Wednesday as cases rise in the country, the tabloid newspaper BILD reported.

“While the continent is unlikely to block as economic ginger France and Germany struggle to contain the virus, it is difficult to predict anything but the two economies and the eurozone as a whole, which are struggling until 2021 or until no vaccine has emerged, ”said Stephen Ines, chief strategist at global markets at AXI, in a note to customers.

Governments are battling new measures to contain the pandemic, which has sparked protests in places like Italy, where the government is reportedly preparing a business easing package affected by new containment measures.

The European Central Bank is meeting on Thursday, but economists do not expect incentives to be taken until the December meeting.

There was a big profit week on both sides of the Atlantic. Technical giant Microsoft MSFT,
+ 1.50%
surpassed revenue and sales forecasts late Tuesday, but its prospects were disappointing. Multinational conglomerates GE GE,
and Boeing BA,
are among the big names reporting Wednesday.

Banks led south in Europe with shares of Deutsche Bank DB,
a decline of 2.5% after the German lender published forecast results, which were raised by the strong performance of its investment bank.

“A good set of results, but an accompanying outlook, which suggests a small change in the EPS (earnings per share) consensus,” said a team of Citi analysts led by Andrew Coombs. “We remain sellers because we believe that the background of the IB (investment bank) industry is unlikely to support Deutsche Bank in 2021.”

Shares of Puma PUM,
fell 2.4 percent after the German sports retailer reported higher third-quarter profits and sales, but said it could not provide guidance for the year due to too much uncertainty about the effects of the virus.

French car manufacturer Peugeot UG,
reported declining revenue in the third quarter and said it expects the European car market to fall by 25% in 2020. Shares fell 3.7%.

Also in France, Carrefour CA,
said “like-like” sales rose in the third quarter and the supermarket group supported the targets set as part of its Carrefour 2022 plan. But shares fell 2.7%.

Shares of Sopra Steria SOP,
slipped 13%, making the French consulting and software development company the worst performance of the Stoxx Europe 600, after declining revenue for the third quarter, mainly due to weak business activity in the aviation sector.

Low oil prices weigh big energy companies with shares of BP BP,
2% discount and total TOT,
decline by 4%. American raw CL.1,
and prices of Brent BRN00,
fell 3.5 percent and 2.5 percent, respectively, after the U.S. Petroleum Institute said late Tuesday that U.S. crude oil supplies rose nearly 4.6 million barrels for the week ended Oct. 23, according to sources. .

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