(Reuters) – European stocks closed lower on Monday, with banks, miners and travel stocks bearing the brunt of investor worries of a second wave of coronavirus cases as many countries emerge from lockdowns.

The pan-European STOXX 600 shed 0.4% after gaining nearly 1% at the open, when a post-holiday catch-up for UK shares supported markets.

As the session wore on, cyclical sectors – more exposed to the health of the global economy – took a hit as investors focused on news that Germany and South Korea reported an acceleration in new coronavirus infections after steps to ease their restrictions.

That dented optimism as France tiptoed out of one of Europe’s strictest lockdowns, while British Prime Minister Boris Johnson set out a cautious plan to get Britain back to work.

Russ Mould, investment director at AJ Bell, said markets were realising the end of lockdown would be quite gradual and “the V-shaped recovery will not be as fast as expected”.

“Indications that countries like Germany and South Korea are seeing an increase in infections is likely to give markets some pause for thought,” he added.

Europe’s mining index led losses as shares in the world’s largest steelmaker, ArcelorMittal, slumped 16.2% after Moody’s downgraded its rating to Ba1 as the credit rating agency expects economic conditions to materially worsen in 2020 due to the pandemic.

Returning from a holiday-extended weekend, Britain’s FTSE 100 closed flat and mid-cap shares rose 0.1%, catching up with a global rally on Friday on easing U.S.-China tensions. [.L]

However, shares in Britain’s low-cost carrier easyJet fell 6% and British Airways-owner IAG dropped 3% as the British government said it would introduce a 14-day quarantine period for most people arriving from abroad.

French stocks took a hit as Airbus SE dropped 2.8% after Australia’s Qantas Airways said it did not expect to take delivery of any new planes in the near term as it grapples with a plunge in demand due to the pandemic.

Aircraft engines maker Safran dropped 3.2%.

Despite a feeble start to the month, European shares have recovered more than 26% since mid-March lows as investors pinned their hopes on a swift economic recovery after countries started to ease lockdowns and policymakers’ support to ailing economies.

That helped markets look past a staggering 20.5 million U.S. job losses in April, while Germany’s Ifo institute said that many industries were cutting jobs, noting that 39% of automotive companies, 50% of hotels, 58% of restaurants and 43% of travel agencies had shed staff in April.

Among gainers, German payments company Wirecard jumped 8.3% after announcing a reshuffle of its management board amid allegations including accounting irregularities and disclosure violations, which it denied.

Frankfurt-listed real estate firm LEG Immobilien gained 3.8% after it confirmed its earnings forecast for 2020 after reporting first-quarter results.

Italian lenders bucked the gloom in Europe’s banking sector with a 0.6% rise, on relief that Moody’s spared the country of a rating downgrade on Friday.

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