European stocks tumble on concerns over recovery
European shares dropped on Thursday again amid bleak prospects for a recovery in the global economy, but shares in Lufthansa rose after a major shareholder endorsed a massive state bailout.
The European Commission said an injection of 6.0 billion euros by Berlin to keep the company afloat was allowed, saving the airline from bankruptcy.
"This substantial amount of aid will help Lufthansa weather the current coronavirus crisis, which has hit the airline sector particularly hard," EU competition commissioner Margrethe Vestager said.
Meanwhile, the pan-European STOXX 600 went down 1.1% by 0717 GMT, led lower by travel and leisure, bank and oil and gas stocks.
An increase in the number of coronavirus cases around the world, prospects of a new trade dispute between the United States and the European Union as well as gloomy forecast for global economy this year caused the STOXX 600 to drop to its lowest since June 15.
“It seems that the ‘second wave’ has arrived even before the first wave subsided. The U.S. and, increasingly, Brazil, are the main hotspots, but the number of new cases is rising elsewhere in the world as well,” said Marshall Gittler, head of investment research at BDSwiss Group.
Among gainers, however, Lufthansa soared 11% after billionaire Heinz Hermann Thiele, the owner of a 15.5% stake, told a local newspaper he would endorse the rescue.
Bayer AG rose 0.3% higher after it agreed to pay up to $10.9 billion to settle US lawsuits that its widely used weedkiller Roundup caused cancer.
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