(Bloomberg) -- European equities tumbled on Friday and were poised for their worst week since the 2008 financial crisis as investors fretted about the potential hit to the global economy from the spreading coronavirus.
The STOXX 600 Index was down 3.5% by 8:04 a.m. London time. The travel and leisure sector slumped 5.3% as British Airways-owner IAG SA (LON:ICAG) said that the coronavirus made it impossible to predict earnings this year, and EasyJet PLC (LON:EZJ) said that it had seen a softening in demand and made plans to cancel flights. Elsewhere Amadeus IT Group SA (MC:AMA), which operates software for flight bookings, dropped 5% after saying that airline travel sales are slowing globally.
A sell-off across European equities has gathered pace this week as new cases of coronavirus infections continued outside of China, with California monitoring 8,400 people after they traveled to Asia. European stocks have fallen 12% since last week’s record high, and are set to post a 7.7% loss in February.
Chris Dyer, director of global equity at Eaton (NYSE:ETN) Vance, said the sell-off has been broad-based and an unwinding of general risk, while at the same time individual companies are starting to quantify the virus.
“The next couple of weeks will be where analysts really start to try to get their head around what the impact is on shares and companies’ earnings for the course of this year,” Dyer said by phone. “That could, from our perspective, lead to some opportunities to add to some selected names.”