European shares dip as Revenue pledges to help firms amid Covid-19 crisis
European stock markets fell again amid investor scepticism that the spending pledges by governments around the world will shield the eurozone and the US from economic damage carried by Covid-19.
In Ireland, after its sharp falls on Monday, the Iseq index ended little changed in the latest session, as shares in Dalata Hotel Group -- Ireland’’s largest hotel group -- tumbled a further 9%, reflecting fears over the outlook for the tourism season.
AIB and Bank of Ireland rallied by 2% and 2.5% following their double-digit percentage losses in Monday’’s global stocks rout.
Irish banks offered their latest products to help business customers.
The Revenue here urged companies facing short-term pressures with cash flow to make contact to strike agreements over phased payments of business taxes, while Business Minister Heather Humphreys detailed the new business supports the Government has offered firms, including low-cost loans, to get through the crisis.
Business group Retail Excellence said it welcomed the emergency business funds but wants the hospitality Vat rate to be brought back down to 9% for at least six months, as well as "an immediate moratorium" on local authority rates payments and a large cut in commercial lease rents through the rest of the year, to save jobs.
European stock markets following their slump on Monday failed to rally amid fears that the fallout from the virus will spark a recession in Germany.
Head of the German Ifo institute Clemens Fuest said he saw the world on the brink of an economic crisis and that there are parallels to the year 2008 when the financial crisis broke.
European stock markets failed to hold their early gains and US markets struggled to hold their gains. "Unsurprisingly, markets have not been too impressed with the US administration’s response to the virus, with today’s press conference likely to lead to a crushing sense of disappointment that could prompt a fresh move to the downside," said Chris Beauchamp at online broker IG.
He said that governments and central banks "still look like they are playing catch-up to a fast-moving situation" and investors fear that the UK budget later Wednesday and the ECB meeting on Thursday may "go the same way".
Airline shares in Europe were mixed, as more flights were cancelled into Italy.
Ryanair shares in Dublin rose 4% on the view that it will benefit from the financial woes of its rivals even as it cut its passenger number projections for the year.
London-listed IAG -- which owns Aer Lingus and British Airways -- were little changed; in Paris, Air France-KLM shares fell a further 2% to brings its losses to 50% in the past year; and shares of Frankfurt-listed Lufthansa were also unchanged but its shares have also dropped 50% in the year.
The European Commission said it would help European airlines by lifting rules over airline landing slots.
"The situation is deteriorating on a daily basis. Traffic is expected to decline further in the coming weeks," said Transport Commissioner Adina Valean, saying the relaxatin of the rules will help "European aviation and the environment".
