European shares slide as virus fears persist, banks drop

(Reuters) – European shares fell on Wednesday, as investors feared a surge in COVID-19 cases after several hard-hit countries started to ease lockdowns, while rising U.S.-China tensions also dented sentiment.

The pan-European STOXX 600 index <.stoxx> fell 1.1% by 0710 GMT, with banks proving a drag after a slew of negative updates.

Shares in Germany’s Commerzbank slid 3.2% and Dutch bank ABN Amro dropped 5.3% after swinging to a loss in the first quarter as the COVID-19 pandemic drove up loan loss provisions.

Deutsche Bank dropped 4.4% on news that top managers will waive one month of fixed pay in an effort to cut costs.

Investors also witnessed the biggest deal involving a European buyer collapse due to the market dislocation caused by the pandemic.

Shares in Exor , the holding firm of Italy’s Agnelli family, fell 4.3% as French insurer Covea walked away from its planned $9 billion purchase of PartnerRe, the Bermuda-based reinsurer owned by Exor.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Bernard Orr)