European markets close sharply lower; Germany’s DAX falls 1.6%

European markets moved sharply lower Tuesday, extending the latest wave of global selling.

The pan-European Stoxx 600 ended down around 1.09 percent by the close, with most sectors and major bourses in negative territory.

Tech stocks were among the worst performers during early afternoon deals. The sector slipped more than 1.9 percent after sharp losses on Wall Street compounded souring market sentiment in Europe.

Europe’s banking index also dipped 2.2 percent by Tuesday’s close amid heightened worries over slowing economic growth. British lender CYBG slumped to the bottom of the benchmark after the firm announced it was planning for a “period of uncertainty” in regards to Brexit negotiations. Shares tumbled nearly 16 percent on the news.

Looking at other individual stocks, France’s Renault lost a further 1.3 percent by Tuesday’s close. That was the second day of trade after it emerged Nissan’s Chairman Carlos Ghosn had been arrested concerning allegations of financial misconduct. Ghosn is also CEO and chair of Renault.

On Monday, Nissan released a statement, saying that “over many years” Ghosn and board director, Greg Kelly, had been under-reporting compensation amounts to the Tokyo Stock Exchange securities report. Most European automakers were negative on Tuesday, as the news showed no signs of respite.

Elsewhere, BTG soared to the top of the STOXX 600 on Tuesday. It comes after Boston Scientific announced it had agreed a cash deal to acquire the health care company, with the U.S. manufacturer offering 840 pence per share. Shares of BTG surged more than 34 percent higher on the news.

The Dow Jones Industrial Average finished almost 400 points down by Monday’s closing bell, with several leading tech stocks taking a beating — including Apple and Facebook.

That sentiment continued on Tuesday, with the Dow off by around 500 points, or 2 percent, after two hours of U.S. trade.

Brexit

The British government unveiled its long-awaited draft withdrawal agreement last week, which details the terms of the U.K.’s departure from the EU on March 29, 2019.

U.K. Prime Minister Theresa May is facing opposition from across the political spectrum to the proposal, which must be approved by Parliament, with critics saying it could leave Britain indefinitely tied to the EU post-Brexit.

The European Union is expected to hold a summit to discuss Britain’s draft withdrawal agreement on Sunday.

If the 27 remaining member states agree to sign off on the draft agreement later this month, the British government would then need to win over a majority of lawmakers at a crucial vote in early December.

Sterling partially rebounded from lows hit versus the dollar on Tuesday morning after Bank of England Governor Mark Carney said the central bank may not cut interest rates in the event of a no-deal withdrawal from Europe.

Source: CNBC