UPDATE 2-Soaring virus cases knock European stocks off 10-month high

  • Reuters
  • Stock Market News
UPDATE 2-Soaring virus cases knock European stocks off 10-month high
Credit: © Reuters.

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* Miners, travel stocks fall on renewed virus fears

* Britain warns next few weeks of pandemic to be the worst

* JD Sports jumps on upbeat 2021 profit outlook (Updates to market close)

By Sruthi Shankar

Jan 11 (Reuters) - European stocks fell on Monday after a strong rally last week took them to the highest level in more than 10 months, retreating as surging coronavirus cases across the continent and mainland China looked likely to dent a global economic recovery.

The pan-European STOXX 600 index .STOXX fell 0.7%, easing from its February 2020 peak hit on Friday.

Germany's DAX index .GDAXI shed 0.8% after hitting all-time highs last week and France's CAC 40 .FCHI was also down 0.8%, while London's FTSE 100 .FTSE dropped 1.1%.

Investors piled into undervalued sectors of the market including banks, energy and mining last week after a Democratic sweep in the U.S. Senate elections raised expectations of larger U.S. fiscal stimulus. Wall Street and Asian stocks hit all-time highs last week, while UK equities added more than 6%.

"What's driving the market is optimism that we will have more U.S. fiscal stimulus, but the question is are all the prerequisites for a real reflation in place," said Elwin de Groot, Rabobank's head of macro strategy.

"I would say the answer to that is no. We still need to cope with the new wave of virus infections, and it's taking quite a bit of time in many countries to rollout vaccines."

Most of Europe was under the strictest restrictions after the continent became the first to report 25 million coronavirus cases last week, while China saw its biggest daily increase in infections in more than five months. markets lagged after a top medical adviser said the pandemic's worst weeks were imminent as a new, more transmissible variant of the disease surges through the population. stocks .SXPP shed 1.7% as a stronger dollar and worries about demand weighed on metal prices. MET/L

Travel & leisure .SXTP stocks fell the most as Carnival (NYSE: CCL ) Corp CCL.N CCL.L reported a bigger-than-expected preliminary quarterly net loss as the cruise operator's business was brought to a virtual standstill by the COVID-19 pandemic. drugmaker Roche ROG.S gained 3.7% after the European Commission approved its Xofluza to treat influenza in patients aged 12 years and above. biggest sportswear retailer JD Sports JD.L rose 3.8% after it forecast fiscal 2021 profit to be "significantly ahead" of current market expectations. jewellery maker Pandora PNDORA.CO inched up 0.4% after it said new lockdown measures had forced it to close a quarter of its stores at the beginning of the year, even as it raised full-year earnings guidance.

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