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European stocks close lower on US tax overhaul concerns; H&M down 13%

European closed lower on Friday, with sentiment curbed by concerns over plans to overhaul the tax system in the U.S.

The pan-European Stoxx 600 closed provisionally lower, down almost 0.2 percent, with most sectors and major indexes trading in negative territory. Retail stocks were by far the worst-performing sector, down more than 2 percent, after H&M reported fourth-quarter sales below its own expectations. Shares of the fashion retailer fell almost 13 percent to their lowest level since 2009.

In other stock news, Deutsche Telekom agreed to buy the Dutch business of Tele2. The latter jumped around 6 percent in early trade but it has since then lost some ground, trading more than 1 percent. Shares of BT were more than 1 percent higher following news that it’s agreed a cross supply of TV packages with rival Sky. Sky’s stock moved up 2.8 percent on the news.

On Wall Street, stocks opened higher as investors awaited the release of the Republican tax bill.

The chairman of U.K. housebuilder Persimmon, Nicholas Wrigley, is resigning after a dispute over an incentive scheme that lined up a £232 million ($311 million) pay-out to three directors, the Financial Times reported.

Overall, market sentiment was also dragged down by developments in the U.S., where two Republican senators are holding out from voting for the GOP tax plan as written, adding uncertainty to the party’s push to overhaul the U.S. tax system. Vice President Mike Pence delayed a trip to the Middle East amid the uncertainty.

In Europe, leaders formally agreed to begin the second phase of Brexit talks. Prime Minister Theresa May told her counterparts she is on track to deliver Brexit. Over the weekend, the U.K.’s Finance Minister Philip Hammond is set to fly to China to seal a billion pounds worth of trade and investment deals, Reuters reported.

In terms of data, euro zone trade balance numbers came in lower than expected with exports dropping 2.4 percent in October. Source: CNBC

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