European stocks down after two-day rally as Tesco slumps

European shares retreated on Wednesday following a two-day rally, as the number of coronavirus deaths rose again in Spain, while France became the fourth country to report a death toll of more than 10,000.

Britain’s biggest retailer Tesco slumped 7% to the bottom of the STOXX 600 after saying it expected to take a hit of up to 925 million pounds ($1.1 billion) from coronavirus-related costs.

The pan-European STOXX 600 index was down 0.9% at 0703 GMT, after a strong start to the week on hopes that infections were plateauing in the worst hit parts of Europe and the United States.

The benchmark index has gained about 20% since hitting an eight-year low on March 16, powered by aggressive global stimulus measures, but remains 25% below its all-time high with sentiment being driven by progress to contain the pandemic.

London’s FTSE 100 fell 1.2%, as the country’s coronavirus death toll crossed 6,100, while Germany’s DAX shed 0.8% after rallying more than 8% in the past two days.