London's FTSE extends losses, broader Europe recovers

London's blue chips fell on Tuesday as a fast-spreading new coronavirus strain in the UK pushed more countries to shut their borders, while broader European markets recovered following the approval of a long-awaited U.S. aid package.

London's FTSE 100 dropped 0.2 per cent to hover near their three-week lows, with materials and energy shares leading declines.

Strict lockdowns went into effect in Britain to curb the spread of the new strain said to be up to 70 per cent more transmissible than the original, triggering border bans and travel restrictions from several countries.

The pan-European STOXX 600 index, meanwhile, rose 0.6 per cent, recovering from its biggest one-day loss in nearly two months on Monday.

The U.S. Congress on Monday approved an $892 billion fiscal stimulus following days of furious negotiation. President Donald trump is expected to sign it into law, keeping hopes of an economic recovery alive.