European stocks fall on back of HSBC shares slump, COVID-19 resurgence

European stocks declined sharply earlier on Monday after a resurgence in COVID-19 cases and weak banking data on the back of suspicious payments over the years led to uncertainties.

Germany’s DAX futures fell by 2.2%, while France’s CAC futures saw a decline of 2%. Meanwhile, FTSE futures in the UK traded 2.5% lower.

Shares in HSBC, the largest bank in Europe in terms of total assets, slumped by 3.9% – its lowest level since 2009 – after being accused of moving large sums of allegedly illicit funds over nearly two decades by the Financial Crimes Enforcement Network.

Economic data in Europe have shown signs of progress, prompting the European Central Bank (ECB) to revise its growth forecast for 2020 at its policy meeting earlier this month. The ECB is reportedly set to review its bond-buying activities to give its other programs the same flexibility as the Pandemic Emergency Purchase Program, its main tool for supporting the economy.