European shares fall again on Omicron worries

By Anisha Sircar and Susan Mathew

(Reuters) -European shares ended lower on Thursday, pressured by COVID-19 worries with highly valued technology stocks continuing their slide while falling oil prices weighed on energy companies.

The pan-European STOXX 600 erased early gains to slip 0.1%, continuing a mid-week wobble on concerns the newly discovered Omicron coronavirus variant could dent global economic recovery as governments ramp up measures to slow its spread.

The International Monetary Fund on Thursday warned the pandemic could turn out far more costly than estimated. This seemingly undid to an extent optimism that came after vaccine makers Pfizer and BioNTech said three shots of their vaccine was effective against Omicron.

Oil prices slipped as a ratings downgrade for two Chinese property developers stoked fears over the economic health of the world’s biggest oil importer, adding to worries. [O/R]

European oil majors BP, Royal Dutch Shell and TotalEnergies fell between 0.6% and 1.5%.

Tech stocks lost another 0.8% as investors moved into defensive sectors ahead of U.S. inflation data due on Friday which could influence the Federal Reserve’s policy stance.

Next week, the European Central Bank is seen maintaining its transitory inflation stance, strategists at Rabobank said.

Michael Bell, global market strategist at JPMorgan Asset Management forecast a positive outlook for European equities next year even if policy tightens as most people are not really going to feel it at least over the next year or two if the economy grows barring COVID-19 hits.

Deutsche Bank dropped 3.4% after the Wall Street Journal reported the U.S. Justice Department said the bank failed to tell prosecutors about an internal complaint in its asset-management arm’s sustainable investing business.

Meanwhile, UniCredit surged 10.8% to the top of Italy’s blue-chip FTSE MIB after the company said it aimed to increase its net profit on average by 10% a year through to 2024.

Fashion retailer LPP jumped 14.7% hitting an all-time high after the Polish clothing company reported better-than-expected third-quarter results.

French waste and water management company Veolia led utility stocks after sources said it was set to secure EU antitrust approval along with Suez for their 13 billion euro tie-up.

Utility firm EDF slipped 2.0% after a trader pointed to a media report on a French government plan to limit the impact of rising electricity prices.

Deliveroo and Delivery Hero fell after the European Commission published draft rules to give workers at online platform companies better social rights, but which companies say could lead to job losses and more litigation in court.

(Reporting by Anisha Sircar in Bengaluru; Editing by Subhranshu Sahu, Amy Caren Daniel and David Evans)

By Anisha Sircar and Susan Mathew

(Reuters) -European shares ended lower on Thursday, pressured by COVID-19 worries with highly valued technology stocks continuing their slide while falling oil prices weighed on energy companies.

The pan-European STOXX 600 erased early gains to slip 0.1%, continuing a mid-week wobble on concerns the newly discovered Omicron coronavirus variant could dent global economic recovery as governments ramp up measures to slow its spread.

The International Monetary Fund on Thursday warned the pandemic could turn out far more costly than estimated. This seemingly undid to an extent optimism that came after vaccine makers Pfizer and BioNTech said three shots of their vaccine was effective against Omicron.

Oil prices slipped as a ratings downgrade for two Chinese property developers stoked fears over the economic health of the world’s biggest oil importer, adding to worries. [O/R]

European oil majors BP, Royal Dutch Shell and TotalEnergies fell between 0.6% and 1.5%.

Tech stocks lost another 0.8% as investors moved into defensive sectors ahead of U.S. inflation data due on Friday which could influence the Federal Reserve’s policy stance.

Next week, the European Central Bank is seen maintaining its transitory inflation stance, strategists at Rabobank said.

Michael Bell, global market strategist at JPMorgan Asset Management forecast a positive outlook for European equities next year even if policy tightens as most people are not really going to feel it at least over the next year or two if the economy grows barring COVID-19 hits.

Deutsche Bank dropped 3.4% after the Wall Street Journal reported the U.S. Justice Department said the bank failed to tell prosecutors about an internal complaint in its asset-management arm’s sustainable investing business.

Meanwhile, UniCredit surged 10.8% to the top of Italy’s blue-chip FTSE MIB after the company said it aimed to increase its net profit on average by 10% a year through to 2024.

Fashion retailer LPP jumped 14.7% hitting an all-time high after the Polish clothing company reported better-than-expected third-quarter results.

French waste and water management company Veolia led utility stocks after sources said it was set to secure EU antitrust approval along with Suez for their 13 billion euro tie-up.

Utility firm EDF slipped 2.0% after a trader pointed to a media report on a French government plan to limit the impact of rising electricity prices.

Deliveroo and Delivery Hero fell after the European Commission published draft rules to give workers at online platform companies better social rights, but which companies say could lead to job losses and more litigation in court.

(Reporting by Anisha Sircar in Bengaluru; Editing by Subhranshu Sahu, Amy Caren Daniel and David Evans)