European stock markets slide, as more jobs cut

By: AFP      Published: 05:32 PM, 1 Jul, 2020
European stock markets slide, as more jobs cut

Europe's major stock markets slid Wednesday as multinationals announced thousands of more job cuts on coronavirus fallout.

European aircraft maker Airbus late Tuesday said it planned to axe about 15,000 jobs worldwide, 11 percent of its workforce, in response to the "gravest crisis" the industry has ever seen, caused by COVID-19.

SSP, the British owner of food outlets in railway stations and airports worldwide, said Wednesday it was eyeing 5,000 UK jobs as the pandemic keeps customers away. Equities were being hit also by fears of a second virus wave and tensions between China and Hong Kong.

"For the same reason that markets didn't take much notice of backward-looking apocalyptic economic data in the spring, more positive data seen recently is also being put to one side as investors instead look ahead to a potential coronavirus second wave and tensions over Hong Kong," said AJ Bell investment director Russ Mould.

In afternoon deals, London's benchmark FTSE 100 index was down 1.1 percent. Frankfurt's DAX 30 shed 1.5 percent and the Paris CAC 40 lost 1.4 percent. Earlier, Tokyo closed down 0.8 percent after a closely watched Bank of Japan survey showed that confidence among the country's biggest manufacturers had hit its lowest level since 2009 during the global financial crisis.

But Shanghai won 1.4 percent with investors taking heart from the easing of reimposed lockdowns in China. Hong Kong was closed for a holiday, though investors were keeping tabs on the city on the anniversary of its handover to China and after Beijing imposed a sweeping security law to prevent further unrest in the financial hub.

Elsewhere Wednesday, oil prices jumped around two percent as investors cheered news that Saudi exports had tumbled in June, indicating it was sticking to a massive output agreement with other major producers including Russia.

It shipped 5.7 million barrels a day last month, compared with 6.2 million in May, a drop equivalent to seven full supertankers over the month. Wall Street stock markets meanwhile capped an extremely strong quarter on a positive note Tuesday, again ending decisively higher and shrugging off new of a resurgence in US coronavirus cases.

The S&P 500, the broadest of the three major US indices, surged 20 percent for the quarter, the biggest such gain since 1998. World stock markets shot higher generally in the second quarter as investors bet on a quick economic recovery, after the coronavirus pandemic caused indices to plunge in the first three months of the year.

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