A rush of coronavirus cases outside China wiped nearly €436 billion off the value of European stock markets on Monday, as investors reassessed the likely impact of the outbreak turning into a pandemic.
A 5.4 per cent slump saw Milan shares marking their worst day since mid-2016, as Italy reported the biggest flare-up of the virus in Europe with at least six deaths and more than 200 infections, which is likely to further upset the country's already ailing economy.
The pan- European Stoxx 600 dropped 3.8 per cent to 411.86, posting its biggest intra-day percentage slump since Britain voted to exit the European Union in June 2016.
A surge in infections in South Korea and Iran prompted widespread moves out of equities and into safe havens such as gold or government bonds.
"Today signifies that markets did not expect this to become a major issue outside of China," said Craig Erlam, a senior market analyst at Oanda. "Investors are going to be far more sensitive now."
The Iseq index of Irish shares was down 4.3 per cent at 6,925. The decline was led by Ryanair, which suffered its biggest one-day fall in several years, closing 13 per cent down at €13.24 on the back of fears that the outbreak could seriously disrupt the European travel industry.
The surge in coronavirus cases also hit globally-focused businesses such as Kingspan, Smurfit Kappa and CRH, which suffered declines of between 3 per cent and 5 per cent.
Separately, Bank of Ireland fell over 5 per cent to €3.76 after warning that it would not be able to meet key profitability targets as ultra-low interest rates squeeze its income. The bank reported that its underlying pre-tax profit fell by 19 per cent last year to €758 million as set aside provisions for bad loans and its net interest margin fell.
Rival AIB closed less than 1 per cent down, having fallen by 6 per cent earlier in the session on foot of Bank of Ireland's results and the general weakness across global markets.
Hotel group Dalata, which will published full-year results on Tuesday, also suffered, shedding nearly 5 per cent in value.
More than £62 billion was wiped off the value of Britain’s top index as global traders reacted with fear to the first major outbreak of coronavirus in Europe. The FTSE 100 lost 247.09 points to 7156.83, a 3.3 per cent drop, its biggest one-day fall in more than four years.
Shares in EasyJet lost almost 17 per cent or 251.8p, Tui was down 9.8 per cent, and British Airways and Aer Lingus-owner IAG lost more than 9 per cent.
Associated British Foods, the company behind Penneys and Primark, saw shares drop 40p, or 1.6 per cent, to 2,543p after it warned there was a risk of supply shortages on some of the retailer's lines later in the year if factory delays in China caused by the coronavirus outbreak were prolonged.
Fears of the economic impact from the outbreak bolstered expectations – already at 50 per cent – that the European Central Bank will cut interest rates by 10 basis points in July.
German shares fell 4 per cent, shrugging off an Ifo survey that showed business morale rose unexpectedly in February.
Juventus slumped 11.8 per cent after the Serie A leader posted a net loss of €50.3 million s in the first half, compared to a profit a year earlier.
Only six stocks on the Stoxx 600 ended higher for the day, led by educational services provider Pearson as it bounced back from a steep fall on Friday.
The Dow Jones Industrials fell more than 800 points and the S&P 500 as well as the Nasdaq hit three-week lows on the surge in coronavirus cases outside China. All of the Dow’s 30 blue-chip members and the 11 major S&P sectors were in the red.
Leading the slide was a 3.4 per cent drop in technology stocks. The defensive utilities and real estate indexes posted the smallest declines.
Apple slid 4.1 per cent as data showed sales of smartphones in China tumbled by more than a third in January. – Additional reporting by Reuters