London/Hong Kong — European stocks steadied on Tuesday, after heavy losses a day earlier sparked by fears over a highly infectious new strain of Covid-19, as Washington approved an $892bn pandemic relief package.
Many countries shut their borders to the UK on Monday because of fears over the new variant of the disease, snarling one of Europe’s most important trade routes just days before Britain is set to leave the EU. The new strain “is a bump in the road, but that road is still leading to a much stronger recovery in the second half of 2021”, said Hugh Gimber, global market strategist at JPMorgan Asset Management. “Markets are a lot calmer today because of confidence that there is a big build up of pent-up demand and a return to much stronger levels of activity in the second half of next year.”