European shares drop as Powell fans recovery fears

European shares retreated on Thursday as comments from U.S. officials fanned concerns of a prolonged economic downturn due to the coronavirus outbreak, while investors eyed the prospect of a second wave of infections fearfully.

The pan-European STOXX 600 slid 1% by 0715 GMT, falling past a one-week low hit on Wednesday after the Federal Reserve Chair Jerome Powell warned of a recession worse than any since World War Two, and called for additional fiscal spending. Automakers, technology and banking stocks led declines, with TeamViewer down 6.3% after private equity firm Permira sold shares worth 1.03 billion euros ($1.1 billion) in the German software company.

Airbus slipped 1.6% following a report that the aerospace group is exploring restructuring plans involving the possibility of "deep" job cuts, industry sources said. In contrast, pan-European exchange operator Euronext gained 5.1% after reporting a 55% jump in quarterly revenue, partly driven by the heavy trading in March which has propped up profits for some banks and brokerages.