BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - European stocks fell in cautious trade Friday amid uncertainties over Brexit, stalled U.S. stimulus talks and worries over surging Covid-19 cases.
After months-long talks and with just three weeks to go until the end of the transition period, British Prime Minister Boris Johnson said there is now a 'strong possibility' the U.K. will leave the EU without a deal.
Near-term U.S. fiscal stimulus appeared unlikely after Democrat House Speaker Nancy Pelosi suggested that negotiations could stretch on after Christmas if necessary.
Amid record daily increases in both coronavirus cases and deaths, calls are growing for tougher lockdown measures in Germany.
The pan European Stoxx 600 dropped 0.8 percent to 389.85 after declining 0.4 percent in the previous session.
The German DAX and France's CAC 40 lost about 0.9 percent each, while the U.K.'s FTSE 100 was down half a percent.
Sanofi shares fell over 3 percent after the drug maker said its Covid-19 vaccine candidate developed with GlaxoSmithKline showed an insufficient immune response in clinical trials.
Energy stocks fell despite Brent Crude oil futures rising above the $50/bbl mark for the first time since the lockdown in March. Total SE shed 1.7 percent, BP Plc declined 1.9 percent and Royal Dutch shell dropped 1.1 percent.
Lloyds Banking Group fell as much as 4 percent and Barclays tumbled 3.7 percent after Bank of England Governor Andrew Bailey warned about how Britain's exit from the EU will affect consumers from January 1.
Rolls-Royce Holdings slumped 5.6 percent. The aircraft engine maker said it expects to end 2020 with net debt of £1.5-£2.0bn after a cash outflow of £4.2bn during the year.
Sweden's Ericsson lost 5.6 percent after if filed a lawsuit against Samsung in the U.S. for non-compliance with FRAND commitments.
In economic releases, the German economy is set to log a less severe contraction this year as the easing of Covid-19 containment measures boosted the third quarter growth, Bundesbank said in its semi-annual report released today.
The economy is projected to shrink 5.5 percent this year instead of -7.1 percent projected in June. The economic recovery is forecast to be interrupted in the final quarter of 2020 and in the first quarter of 2021 with the resurgence of the pandemic.
'We expect the containment measures to be loosened gradually in spring 2021 thanks to medical advances and consumption opportunities to be taken again,' Bundesbank President Jens Weidmann, said.
Copyright RTT News/dpa-AFX
© 2020 AFX News
