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New COVID strain: A fresh blow to Britain’s economy

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New COVID strain: A fresh blow to Britain’s economy

Report from Deutsches Welle

See www.dw.com.

Flight and freight bans from the UK due to a new strain of the coronavirus have sparked a stock market sell-off across Europe. The blow comes while Britain and the EU remain deadlocked over a trade deal.

European stocks slumped Monday as several European Union countries imposed flight bans from the UK to stop the spread of a new highly infectious strain of coronavirus found in England.

London’s benchmark FTSE 100 index fell 2.9% in midmorning trade and the British pound slid sharply. Germany’s DAX index dropped 3.4% while France’s CAC was 3.2% lower.

Travel stocks led the rout, with British Airways owner IAG,Wizz Air Holdings and easyJet falling between 11% and 16%, while InterContinental Hotels Group dropped 4%.

As crude prices slid over concerns that the new measures could hurt travel well into the new year, energy majors BP, Total and Royal Dutch Shell had lost between 3% and 6% by mid-afternoon.

By the afternoon, the main indices had regained some of their losses but New York’s S&P 500 Index traded more than 1% lower.

Market analysts said the new mutation could be a major setback in the global fight against the pandemic, despite the approval of several vaccines.

Craig Erlam”This new strain suggests that not only could it[ Britain] be in for a [bad] couple of months… [but the new strain] could make things far, far worse: more restrictions, more lockdowns … more of an economic toll,”, Craig Elma senior market analyst at OANDA Europe, told news agency AFP.

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