China virus fear spreads to European stocks

European shares slipped on Tuesday as mounting concerns over a new coronavirus originating in China sparked demand for safe-haven assets.

The outbreak reminded investors of the economic fallout from the SARS crisis in 2003 that killed nearly 800 people, especially due to the increased threat of infection as hundreds of millions travel for the Lunar New Year holidays. The pan-European STOXX 600 dropped 0.8% at 0806 GMT, with all major sub-sectors in negative territory.

Shares of luxury goods makers - which have large exposure to China including LVMH, Kering, Hermes, and Burberry - were among the biggest laggards. Bank stocks slipped about 1% as Switzerland's largest bank UBS Group AG cut its profitability targets.

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