European markets close lower as virus fears offset recovery hopes

European markets closed lower Thursday as fears over rising U.S. coronavirus cases appeared to offset hopes of a potential economic recovery.

The pan-European Stoxx 600 closed 0.8% lower provisionally, with utilities stocks leading the losses as most sectors traded in negative territory. Technology shares bucked the trend with a 0.8% gain.

Market sentiment has been rattled of late by the persistently rapid spread of the coronavirus in the U.S., where the number of cases surpassed the 3 million mark on Wednesday, according to Johns Hopkins University. Stocks in Europe had earlier traded higher amid optimism over the prospects of a recovery for the global economy, as signs of progress emerge in data and scientific discovery. 

Gilead Sciences on Wednesday began testing an inhalable form of its antiviral Covid-19 drug remdesivir which can be administered outside hospitals. Meanwhile Reuters reported, citing a European Commission source, that the Commission has secured deals for experimental treatments from Merck and Roche.

Wednesday also saw further fiscal stimulus from a major European economy, as U.K. Finance Minister Rishi Sunak announced a back-to-work bonus scheme for businesses bringing furloughed employees back to work, and a 50% restaurant discount for all citizens through August. Sunak in total promised 30 billion pounds ($38 billion) of measures to stave off a much-feared unemployment crisis.

On Wall Street, stocks fell, giving back some of their weekly gains amid renewed concerns over the coronavirus and its impact on the U.S. economy. Jobs data released by the Labor Department Thursday showed 1.314 million Americans filed for unemployment benefits last week.

In corporate news, Airbus deliveries climbed by 50% from May to June, but the first half of the year still marked a 16-year low as the coronavirus pandemic and worldwide shutdowns ravaged demand. Airbus shares fell about 4% by the end of the session.

German software manufacturer SAP said business activity gathered steam at a greater pace than expected in the second quarter, confirming its full-year outlook with revenues and operating profits increasing. The stock was the second-best performer in Europe, climbing almost 5%.

The bigger individual gainer however was U.K. housebuilder Persimmon, which rose 7.2% after signaling a recovery in forward sales following a weak first half.

At the other end of the European blue chip index, Idorsia stock fell nearly 12% after news that Johnson & Johnson's Cilag Holding will sell up to 11.8 million of the Swiss biotech company's shares.