By Steve Goldstein, MarketWatch
European stocks suffered historic losses on Thursday after President Donald Trump announced a ban on travel to the Continent as European Central Bank President Christine Lagarde appeared to pass the buck on aiding the eurozone's economy.
The Stoxx Europe 600 dropped 11%, its worst-ever loss, with record declines for the German DAX and French CAC 40 as well. Deutsche Lufthansa (LHA.XE) lost 13% as Bernstein Research said the German airline, as well as Delta (DAL) and United (UAL), are most impacted by the travel ban.
Trump, in a televised address, announced a ban on travel to Europe for 30 days. It isn't iron clad -- U.K. and Irish travel is permitted, as is European travel for American citizens.
Other travel stocks including InterContinental Hotels (IHG.LN) also dropped.
The selling was not remotely limited to the travel sector, with the financial sector also getting pounded.
On the London Stock Exchange, there were 2,991 decliners to just 165 advancers.
"Markets reacted negatively to what was perceived as a solemn but confused speech that placed blame on other nations, omitted to focus on immediate actions to relieve the most affected individuals, and lacked in concrete fiscal and health measures to address the economic and financial impact of the virus," said Gregory Daco, chief U.S. economist at Oxford Economics.
Italy, meanwhile, has closed all shops outside of supermarkets and pharmacies. Italy's FTSE MIB fell about 15%, its worst ever loss, as Italian government bonds sold off.
The European Central Bank did not cut interest rates and said there were no "material signs of strains in the money markets or liquidity shortages." Lagarde also said it wasn't the ECB's job to narrow Italian bond spreads as she called on euro-area governments to increase fiscal stimulus.
"It seems the ECB is falling behind the curve," said Jon Day, fixed income portfolio manager at Newton Investment Management.
-Steve Goldstein; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
March 12, 2020 12:35 ET (16:35 GMT)
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