Europe midday: Shares continue slide on prospect of no-deal Brexit

European shares extended losses on Friday as the prospect of a no-deal Brexit became an increasingly likely prospect with both sides talking down hopes of an agreement.

The pan-European STOXX 600 had slid 1.39% lower, with all major bourses in the red. The FTSE 100 was down 1% at 6,537.16, while the pound was 0.8% lower against the dollar at 1.3195 and 0.6% weaker versus the euro at 1.0889, as European Commission President Ursula von der Leyen reportedly told EU leaders that "the probability of a no deal is higher than of a deal".

Sentiment was also hit by news that a Covid-19 vaccine being developed by Sanofi and GlaxoSmithkline had been delayed as it did not provide a sufficient immune response in elderly people. Sanofi shares were down 2% on the news while Glaxo stock was slightly lower.

Brexit trade talks appeared to be heading nowhere as a Sunday deadline loomed, with the UK suggesting a no-deal departure from the EU was likely.

Banks and housebuilders slumped amid Brexit worries, with Barclays, Lloyds, NatWest, Persimmon, Taylor Wimpey and Barratt Developments all weaker.

Rolls-Royce shares fell despite the company saying it expected to turn cash flow positive in the second half of 2021 as air travel demand started to recover from the Covid-19 crisis driven by vaccination programmes.

It also maintained full-year guidance, adding it was targeting at least £750m in free cash flow, excluding disposals, as early as 2022 and at least £2bn from disposal proceeds.

Bellway was in the red even after saying it expected annual volumes to rise by a quarter as the stamp duty holiday and government help drove higher demand for new homes. The company said its forward order book was up 18.7% to £1.77bn in the 17 weeks to November 2

On the upside, Calisen shares surged after it agreed to be bought by a consortium of investors in a deal that values the smart meter company at £1.4bn.

Elsewhere, meal-kit delivery company HelloFresh rose 6.5%, prompting rises in Just Eat Takeaway, Delivery Hero and online supermarket Ocado - all of which have benefited from Covid-19 restrictions and lockdowns.

(Michele Maatouk also contributed to this report)