UPDATE 3-European shares drop on coronavirus cases, weak euro zone data

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* UK and Italy have first coronavirus cases
* Italy's cabinet declares a state of emergency on the virus
* France, Italy post surprise GDP contractions in Q4 2019
* Spain's Banco Sabadell slides after results
* Novacyt rockets after launching a new test for coronavirus

(Updates to close)
By Medha Singh and Joice Alves
Jan 31 (Reuters) - European shares gave up earlier gains to
end firmly in negative territory on Friday after the United
Kingdom and Italy confirmed their first coronavirus cases, and
with a set of disappointing euro zone indicators also weighing
on sentiment.
Britain's blue chip index .FTSE closed down 1.3%, while
Milan's main benchmark .FTMIB bled 2.3% as the country's
cabinet declared a state of emergency over the virus. Britain
and Italy have two cases each. The pan-European STOXX 600 .STOXX ended 1.1% lower, taking
losses this week to 3% for its worst week in almost six months.
On the month, it lost 1.2% - its worst January since 2016.
"Each new case adds to the uncertainty about the virus,"
said Philip Marey, a strategist at RaboBank.
The World Health Organization declared the epidemic a global
emergency on Thursday as the death toll passed 200 and the
number of cases of infection rose to nearly 10,000.
While the illness has been centred on China, governments
around the world are scrambling to stop its spread and travel
curbs and supply chain disruptions have prompted economists to
reassess the potential economic fallout from the outbreak.
Miners .SXPP were the biggest losers, down 1.6%, on
worries that China and its gigantic market for raw materials
will come to a standstill if the epidemic worsens.
Travel and leisure .SXTP stocks also extended losses as
more airlines suspended flights to China. Concerns about the euro zone economy also pushed stocks
downwards.
Economic growth in the bloc was less than expected in the
last quarter of 2019, mainly due to surprise GDP contractions in
France and Italy, while core inflation slowed in January in a
worrying sign for the European Central Bank. The United Kingdom's official exit from the European Union
later on Friday had no immediate impact on stocks but it fuels
uncertainty going forward. The FTSE 100 is roughly back to where
it was before Prime Minister Boris Johnson's landslide election
win on Dec. 12 during which he promised to "get Brexit done".
Among earnings updates, Spanish lender Banco Sabadell
SABE.MC tumbled almost 14% to the bottom of STOXX 600 after
the lender swung to a loss in the fourth quarter.
On the other hand, shares of Signify LIGHT.AS , the world's
largest maker of lights, rallied 7% after reporting a higher
quarterly core profit, which prompted a price target hike from
JP Morgan. France-based healthcare company Novacyt ALNOV.PA NCYT.L
shot up 81% after saying it had launched a new molecular test
for the coronavirus.