European shares slide on rising fears of second coronavirus wave

European shares tumbled on Monday as concerns of a second wave of coronavirus infections grew with Beijing reporting a record number of new cases, while underwhelming economic data from China also weighed on sentiment.

The pan-European STOXX 600 fell 2.4pc, slipping further from its 5.7pc fall last week, with the exporter-heavy German index leading declines.

Global stock markets also began the week on a glum note as the recent outbreak in Beijing, which has been traced to a wholesale food market, revived fears of the economic damage from the health crisis.

Major European indexes have moved further away from their three-month highs hit recently due to a rise in COVID-19 cases in the United States and a downbeat economic outlook from the Federal Reserve last week.

"It has served as a reminder that the optimism driving markets in recent weeks can very quickly dissipate if hopes for a V-shaped recovery are overridden by fears of a second lockdown," said Marco Stoeckle, head of corporate credit research at Commerzbank.

Miners as well as travel and leisure stocks were among the worst performers of the day. By the first hour of trading, all stocks in the euro zone blue-chips index were lower.

European indexes also came under pressure after data showed China's industrial output grew by a lower-than-expected 4.4pc in May from a year earlier, while retail sales fell 2.8pc, missing expectations, in a sign of weak domestic demand.

BP slid 4.7pc as it said it would incur an up to $17.5 billion writedown in the value of its assets after lowering its long-term oil and gas price outlook in expectation of an accelerated transition away from fossil fuels.

Swiss sensor maker Sensirion jumped 16.6pc after lifting its 2020, outlook as sales of gas sensors for medical ventilators needed to treat COVID-19 patients surged.

H&M reported a sharp but slightly smaller-than-expected drop in second-quarter sales as measures to slow the COVID-19 pandemic slammed the sector.

Shares of the world's second-biggest fashion retailer fell 1.7pc.

Meanwhile, European countries eased some border controls on Monday after coronavirus lockdowns, although Spain kept its borders shut.