European stocks face sharp decline on rising concerns about Ômicron

The actions europeans closed lower on Monday (20) and registered their worst session in three weeks amid a global sell off on stock exchanges, with investors worried about the possibility of tighter restrictions hitting the global economy as the cases of the Ômicron variant of the coronavirus increase.

The pan-European STOXX 600 index closed down 1.38% to 467.35 points, its lowest level in two weeks. Oil, mining and auto company stocks led the losses, with all major sub-indices ending down.

“The headlines about booster doses working against Ômicron have given little support, but if we are moving towards more movement restrictions and as virus cases continue to increase, we will see stock markets remaining under pressure for a while,” said David Madden, analyst at Equiti Capital.

The FTSE 100 index retreated 1%, amid weakness in equities linked to commodities, due to a fall of more than 5% in oil prices, since the spread of the Ômicron strain across Europe fueled demand concerns.

Madden added that low liquidity in the final weeks of December could also be leading to exacerbated moves.

Last week, the STOXX 600 had a rally after the European central bank (ECB) has pledged continued economic support and the Federal Reserve (Fed, US central bank) signaled the long-awaited end of its economic stimulus adopted at the start of the pandemic for March, sharing an optimistic economic outlook.

In London, the Financial Times index retreated 0.99%, to 7,198.03 points. In Frankfurt, the DAX index fell 1.88%, to 15,239.67 points, while the CAC-40 index lost 0.82%, to 6,870.10 points in Paris.

The Ftse/Mib index had a devaluation of 1.63%, to 26,177.76 points, in Milan. In Madrid, the Ibex-35 index registered a decrease of 0.83%, to 8,242.40 points, while in Lisbon, the index PSI20 devalued by 1.00%, to 5,385.60 points.