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European Shares Fall As Virus Infections Soar

us pre market 053119 01apr20 lt

European stocks fell sharply on Wednesday as reports of rising numbers of coronavirus cases deepened the gloom over the likely impact on the world economy.

The U.S. recorded a big daily jump of 26,000 new cases, bringing the total to more than 189,000. The death toll there leaped to over 4,000, with officials predicting the disease could kill between 100,000 and 240,000 Americans.

U.N. Secretary-General Antonio Guterres warned Tuesday that the world faces the most challenging crisis since World War II, threatening a lengthy global recession that probably has no parallel in the recent past.

The pan European Stoxx 600 fell 2.9 percent to 310.73 after climbing 1.7 percent on Tuesday.

The German DAX dropped 3.2 percent, France's CAC 40 index gave up 3.8 percent and the U.K.'s FTSE 100 was down 3.1 percent.

Banks HSBC, Santander and Lloyds Bank fell 4-8 percent after suspending dividends.

Adidas lost 3.8 percent. The sportswear maker said it would stop a 1 billion euros share buyback it had planned for this year, because of economic uncertainty caused by the dynamic developments related to the coronavirus outbreak.

Contracting firm Bilfinger plunged as much as 14 percent after suspending its 2020 guidance.

Continental AG gave up 4.7 percent. The automotive parts manufacturing company said, due to business impacts from COVID-19 Pandemic, it has decided to withdraw the outlook for fiscal 2020.

Over 40 percent of Continental's production locations worldwide have temporarily ceased activities.

Commodities miner Glencore tumbled 4.3 percent. The company deferred a decision on its dividend payout for this year, warning of material disruption to production.

Residential developer Taylor Wimpey fell over 5 percent. The company announced a pay cut to Executive Directors to conserve cash due to the coronavirus or Covid-19 crisis.

In economic releases, Eurozone manufacturing activity contracted at the fastest pace in more than seven years in March as the outbreak of coronavirus, or covid-19 weighed on orders, output, employment and confidence, final data from IHS Markit showed.

The final factory Purchasing Managers' Index fell to 44.5 from 49.2 in February. The reading was also below the flash estimate of 44.8.

The U.K. manufacturing activity contracted in March due to the outbreak of coronavirus and subsequent mitigation efforts, final survey data from IHS Markit showed.

The Chartered Institute of Procurement & Supply factory Purchasing Managers' Index fell to 47.8 in March from 51.7 in February. The flash estimate was 48.0.

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