European markets close lower amid concerns over Trump’s protectionism

European markets closed lower on Monday after U.S. President Donald Trump took office and promised to pursue a protectionist policy.

The pan-European Stoxx 600 ended down 0.43 percent with most sectors trading in negative territory. Market players appeared to be adopt a cautious approach after President Donald Trump reiterated his intention to pursue a protectionist agenda.

Banking stocks were among the worst performers on Monday, with the sector off by more than 1.2 percent.

Credit Agricole was 2.7 percent lower after a 491 million euro ($525 million) charge on its French retail unit last Friday. In Italy, reports said that Intesa Sanpaolo could take a stake in Generali.

The latter was up by more than 3.9 percent, topping the European index.

Oil and gas stocks were off by 1.3 percent as investors doubt that there will be a 100 percent compliance with an output cut deal stroke last year.

The euro and the sterling were higher on Monday against the dollar. The latter hit a five-week higher as investors believe that Tuesday’s supreme court ruling will say that the U.S. government will need parliamentary approval on its Brexit deal.

On Wall Street, both the Dow Jones Industrial Average and the broader S&P 500 traded down by more than 0.3 percent.

The earnings season has kicked off in Europe with Philips Lighting announcing that its operating profit margin rose to 9.1 percent. Its earnings before profit stood at 645 million euros ($693 million) compared to 547 million euros in 2015. Its shares were off by 0.1 percent on Monday.

Shares of the Swedish Fingerprint Cards tumbled over 7.5 percent after its board member Lars Soderfjell was taken into custody by authorities on suspicion of market abuse, Reuters reported.

Essentra, a packaging components firm, said Monday its full-year adjusted operating profit would not be reached due to “challenging market conditions.” Its shares pared most its losses after a drop of 10 percent in early trade.

Reports of a potential merger between Berkeley Group and Bovis Homes sent their shares higher in early trade. The latter was up by more than 3.6 percent.

The European statistics office, Eurostat, reported that government debt dropped across the euro zone to 90.1 percent of GDP in the third quarter of last year.

Source: CNBC

Leave a comment