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UPDATE 2-European shares end lower on lockdown worries, still posts third week of gains

Published 03/19/2021, 05:37 PM
Updated 03/20/2021, 01:10 AM
© Reuters.

(For a Reuters live blog on U.S., UK and European stock
markets, click LIVE/ or type LIVE/ in a news window)
* Lockdowns in France hurt sentiment
* STOXX 600 post 0.2% weekly rise
* Auto stocks take a breather; Banks tumble

(Adds comments, updates prices throughout)
By Sruthi Shankar and Shreyashi Sanyal
March 19 (Reuters) - European stocks slid on Friday after
France imposed fresh regional lockdowns to curb the spread of
the coronavirus, amid concern over the pace of vaccination
campaigns in some countries, while bank stocks led sectoral
declines.
The pan-European STOXX 600 .STOXX fell 0.8%, with France's
CAC 40 .FCHI dropping 1.1% after the nation imposed a new
four-week lockdown from Friday in 16 regions badly hit by the
COVID-19 crisis. "The new lockdown will have a significant impact on economic
activity and further deteriorate France's economic outlook for
the first part of 2021," said Charlotte de Montpellier,
economist, France and Switzerland, at ING.
"The current slow pace of the vaccination campaign leaves
little hope for a full lifting of the restrictions after the end
of the 4-week lockdown."
French hotel group Accor ACCP.PA , Air France AIRF.PA and
catering company Sodexo EXHO.PA were flat to lower.

Concerns over the pace of vaccination gained ground after
Britain said it will have to slow its rollout next month due to
a supply crunch caused by a delay in shipment. "We are in this awkward phase where we are clearly seeing
light at the end of the tunnel even through slow vaccination,"
said Philipp Lisibach, chief global strategist at Credit Suisse
in Zurich.
"Nonetheless, in the summer we expect that many countries
will be in a position to lift some of the restrictions and we
expect that this is going to be the kick-off of a sharp economic
reacceleration in Europe."
European stocks still gained 0.2% for the week as a rally in
automakers and signs that the U.S. Federal Reserve will maintain
low interest rates despite an expected surge in economic growth
outweighed concerns about rising yields.
Automakers .SXAP fell 1.6% after a strong run, ending with
the sector's best weekly performance since early February. The
banks index .SX7P tumbled 2.3%, posting the biggest declines
among European sectors on Friday.
Lenders were particularly affected by downbeat sentiment
spilling over from Wall Street after the Fed said it would not
extend a temporary capital buffer relief put in place to ease a
pandemic-driven stress in the funding market. Europe's biggest utility Enel ENEI.MI rose 3.0% after it
stuck to its targets for the year after beating earnings
expectations. German sportswear makers Adidas ADSGn.DE and Puma
PUMG.DE fell more than 2% each after Nike's NKE.N
disappointing full-year revenue forecast. Evolution Gaming EVOG.ST gained 3.8% after Goldman Sachs
started coverage of the Swedish casino games developer with a
"buy" rating.

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