European shares lose ground on concerns of second coronavirus wave

(Reuters) – European shares retreated at the open on Thursday as a spike in COVID-19 cases in China and some U.S. states triggered fears of a second wave of infections, knocking back hopes of a swift recovery from the pandemic-led economic slump.

Investors scaled back on risk as the daily count of cases hit new highs in California and Texas, two of the United States’ most populous states, while Beijing ramped up movement curbs on Wednesday.

The pan-European STOXX 600 index <.stoxx> fell 0.4% at 0709 GMT after two straight days of gains, driven by optimism over global stimulus helping economies claw back from the coronavirus-led slide.

Oil & gas <.sxep> and miners <.sxpp> led declines among European sector indexes, while retailers eked out gains at the open.

German online fashion retailer Zalando jumped 5.3% after it said it expected a bigger increase in sales and operating profit in the second quarter than analysts are forecasting as the pandemic prompts more people to shop online.

(Reporting by Shreyashi Sanyal in Bengaluru)