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UPDATE 2-European shares move little as focus turns to economic damage from COVID

Published 11/26/2020, 05:53 PM
Updated 11/27/2020, 01:30 AM
© Reuters.

(For a Reuters live blog on U.S., UK and European stock
markets, click LIVE/ or type LIVE/ in a news window)
* UK to face tough post-lockdown restrictions
* British pubs cut jobs as losses widen
* French, German consumer confidence fall in November
* Aviva plans to cut 2020 dividend

(Updates to close)
By Shriya Ramakrishnan and Shashank Nayar
Nov 26 (Reuters) - European shares moved little on Thursday
as an extension of coronavirus restrictions in Germany and a
grim growth forecast for the United Kingdom brought the focus
back to the near-term economic damage caused by the COVID-19
pandemic.
The pan-European STOXX 600 .STOXX index ended down 0.1%,
with gains in tech .SX8P and healthcare .SXDP offset by
declines in automobile .SXAP and energy .SXEP shares.
A second wave of coronavirus infections coupled with rising
COVID-19 related deaths continues to sweep across Europe,
prompting Germany, France and the United Kingdom to once again
impose tough curbs, dealing a heavy blow to business activity as
restaurants, gyms and shops remained closed.
"While it is still too early to say if the investor optimism
is hurt as the wider market is still in an uptrend, there are
plenty of negative headlines out there for investors to wait and
think of the near-term effects," said Connor Campbell, a
financial analyst at Spreadex.
The benchmark STOXX 600 index is however still on course for
its best month on record and market participants expect European
equities to touch record highs next year, following promising
vaccine trial results from three major drugmakers. British shares were the worst hit with the benchmark FTSE
100 index .FTSE down 0.4% after health minister Matt Hancock
announced that several parts of England will be forced to live
under the toughest category of COVID-19 restrictions when a
national lockdown ends on Dec. 2. Britain's domestically focused mid-cap index .FTMC dropped
0.9% after finance minister Rishi Sunak said that the record
public borrowings were not sustainable, following his warning on
Wednesday that the economy was on course to shrink by 11.3% this
year. Chancellor Angela Merkel said that Germany will face
restrictions on public life for the foreseeable
future. Germany's blue-chip DAX .GDAXI ended flat while France's
benchmark CAC 40 .FCHI erased gains to end 0.1% lower after a
survey showed consumer confidence in the country fell to a
two-year low in November. In company news, British insurer Aviva AV.L dropped 0.2%
after saying it expects to pay a total 2020 dividend that is a
third less than before the coronavirus outbreak. British pub operators Mitchells & Butlers MAB.L and
Fuller, Smith & Turner FSTA.L fell 0.7% and 5.4% after they
announced around 1,650 job cuts as the hospitality industry
reels from new lockdowns.

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