UPDATE 2-European shares sink on lockdown concerns as virus cases surge

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* France imposes curfew, other European nations shut schools
* Autos, energy, insurance sectors shed more than 2%
* Traders await Brexit update as EU summit begins
* Ryanair slides on plans to cut winter capacity

(Updates to close)
By Sagarika Jaisinghani
Oct 15 (Reuters) - European shares sank on Thursday as a
resurgence in COVID-19 cases across the continent and fading
hopes for more U.S. fiscal stimulus before the presidential
election dented demand for equities globally.
The pan-European STOXX 600 index .STOXX fell 2.1% in its
worst day in more than three weeks, with autos .SXAP ,
insurance .SXIP and energy .SXEP stocks tumbling more than
2%.
Bank shares .SX7P tracked a decline in bond yields,
shrugging off signs of a pickup in M&A activity after a report
said Italy's Banco BPM BAMI.MI and France's Credit Agricole
CAGR.PA had signed a confidentiality agreement in a first step
towards formal talks over a possible merger. "Investors are unnerved by what's going on with COVID-19 and
how that is negatively impacting jobs and the ability for many
businesses to succeed," said Russ Mould, investment director at
AJ Bell.
"It's becoming more apparent that the pandemic could still
be raging well into 2021 and so economic prospects have become
even more clouded."
European stock markets bounced from the coronavirus lows hit
in March on a raft of global stimulus, but sentiment has
recently taken a hit from the surge in infections as well as
signs of a slowing economic rebound.
France has imposed curfews and other European nations are
closing schools and cancelling surgeries in an attempt to
contain the resurgence ahead of the winter season. Bourses in France .FCHI , Italy .FTMIB , Spain .IBEX and
Germany .GDAXI fell between 1.4% and 2.8%.
The UK's FTSE 100 was down 1.7% as the government imposed
tighter restrictions in London, while investors looked for signs
of progress towards a Brexit trade deal at the two-day European
Union summit that began on Thursday. .L
EU leaders said agreeing a "fair" new partnership with
Britain was "worth every effort" but that the bloc would not
compromise at any cost and was ready for an abrupt split in
trade worth a trillion euros every year. "It's not in anyone's interest if the UK leaves the EU
without a deal and markets are so far leaning towards an
11th-hour Brexit agreement," said Hussein Sayed, a market
strategist at FXTM.
In company news, Swiss drugmaker Roche ROG.S shed 3.5%
even as it posted record revenue in its diagnostics division
that offset declining drug sales and kept it on track to meet
its full-year 2020 targets. Ryanair RYA.I fell 4.3% as it said it would cut its
planned winter capacity by a third due to the wave of travel
restrictions imposed by European governments.