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European Shares Fall After Two-day Rally

stockmarkets aug16 26mar20 lt

European stocks fell on Thursday as lingering worries about a global recession prompted traders to book some profits after sharp gains in the previous two sessions.

Also, weak data from Germany and the U.K. overshadowed optimism from a historic $2 trillion U.S. fiscal stimulus deal.

German consumer confidence is set to decline sharply to the lowest in more than a decade in April as the increase in the number of coronavirus infection cases and the accompanying measures made consumers to take cautious approach, survey data from market research group GfK showed.

The forward-looking consumer confidence index fell to 2.7 from 8.3 in March. The score was forecast to fall moderately to 7.7 from March's initially estimated value of 9.8. During the financial and economic crisis, the consumer climate index was at 2.6 points.

U.K. retail sales dropped 0.3 percent on a monthly basis in February, in contrast to a 1.1 percent rise in January and confounding expectations for an increase of 0.2 percent, data from the Office for National Statistics revealed.

Investors also await the interest rate announcement from the Bank of England.

Economists expect the bank to retain its record low interest rate and to expand asset purchase program to GBP 635 billion from GBP 435 billion.

The pan European Stoxx 600 dropped 1.8 percent to 307.67 after rallying 3.1 percent the previous day.

The German DAX fell 2.4 percent, France's CAC 40 index gave up 2.1 percent and the U.K.'s FTSE 100 was down 1.9 percent.

Electricals retailer Dixons Carphone rose over 1 percent. The company has warned that it would not meet its forecast for 2019-20 profit and debt.

Weir Group, a company engaged in engineering businesses, lost 3.6 percent after withdrawing its 2020 guidance.

Kuka AG, a manufacturer of industrial robots and solutions for factory automation, fell 2.6 percent after reporting its fiscal 2019 results.

Fraport advanced 1.6 percent. The company said it has proposed to the Annual General Meeting to carry forward net profits of the financial year 2019 entirely into revenue reserves, citing the recent developments of the coronavirus pandemic.

Drillisch climbed 3.8 percent. The telecommunication service provider expects revenue and earnings for fiscal year 2020 to be roughly on a par with the level of the previous year.

SMA Solar surged 14 percent after narrowing its FY19 loss.

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