European shares retreat after biggest three-day surge ever

European shares tumbled in early trading on Friday after a stunning three-day rally sparked by hopes of more aggressive stimulus to shore up the global economy ravaged by the rapid spread of the coronavirus pandemic.

The pan-European STOXX 600 index was down 1.8 per cent at 0808 GMT, but still on course for one of its best weeks since the global financial crisis.

The benchmark index has recovered almost 17 per cent since hitting a low on March 16, but remains more than 26 per cent below its all-time high last month in a rout that has erased more than $3 trillion from the value of European firms.


With the pandemic still far from contained in Europe, the bloc has suspended state aid rules and limits on public borrowing and approved $40 billion worth of emergency funds to help airlines, among the hardest hit sectors in the global emergency.

After leading the rebound this week, travel and leisure stocks fell 3 per cent. Energy stocks were down 2.9 per cent as oil erased early gains.

French car parts company Faurecia shed 5.2 per cent after abandoning its financial outlook due to the hit to its business from the health crisis.