European markets closed lower Tuesday, amid escalating concerns about a slowing global economy.
European markets closed lower Tuesday, amid escalating concerns about a slowing global economy.
The pan-European Stoxx 600 closed provisionally down 0.82 percent, with most sectors and major bourses in negative territory.
The Stoxx 600 has fallen more than 12 percent year-to-date, dragged lower by heightened fears of a possible slowdown and political uncertainty. The index is also on track for its fourth straight month of declines.
Europe’s oil and gas stocks were the biggest fallers Tuesday, down 2.47 percent as crude prices came under further strain from oversupply concerns. Oil prices sank to a 15-month low following news that output from the U.S. and Russia had hit record levels ahead of planned output cuts by OPEC and its allies.
Looking at individual stocks, Britain’s Indivior surged toward the top of the European benchmark on Tuesday. The drugmaker announced it would sell a cheaper version of its flagship opioid addiction treatment drug, while maintaining its full-year profit and revenue forecast. Shares of the London-listed stock surged nearly 18 percent higher on the news.
Getlink was also trading higher during afternoon deals. It comes after French builder Eiffage bought a 5 percent stake in the firm, which operates the Channel Tunnel between France and the U.K. Shares of Getlink rose nearly 5.5 percent.
On the other end, shares of utility providers fell around 2 percent following news that SSE and Innogy’s Npower had ditched plans to merge their U.K. energy retail operations, citing “challenging market conditions.” The deal would have created the U.K.’s second-largest energy supplier. Shares of Innogy slipped 0.91 percent, while SSE’s stock fell 1.28 percent.
On the data front, Germany’s Ifo business sentiment index came in weaker-than-expected on Tuesday. The survey of business sentiment in Germany dropped to 101.0 in December, down from 102.0 in November. The euro was little changed on the news, trading at 1.1385 against the dollar at around 10:20 a.m. London time.
Darkening growth outlook
Market focus is largely attuned to a darkening global growth outlook, following a flurry of sluggish economic reports. On Monday, the National Association of Home Builders Housing Markets Index indicated U.S. homebuilder sentiment had dipped to a three-and-a-half year low. It was the second straight month of disappointing reading.
The gloomy data compounded weaker-than-expected economic news from Europe late last week.
In addition, a profit warning from Asos shocked investors on Monday. Shares of the company tumbled more than 30 percent on the news.
The previously high-flying clothing retailer also prompted U.S. consumer discretionary shares to fall almost 3 percent, with stocks on Wall Street slipping to their lowest levels in more than a year on Monday.
On Tuesday, U.S. stocks rebounded, with the S&P 500 climbing 1 percent after falling to a new 2018 low in the previous session. The Dow Jones Industrial Average jumped more than 280 points while the Nasdaq Composite rose 0.8 percent.
Back in Europe, Britain’s embattled Prime Minister Theresa May announced Monday a parliamentary vote on her Brexit deal would take place in the third week of January.
This prompted Britain’s leader of the opposition, Jeremy Corbyn, to table a motion of no confidence in Theresa May, saying it was unacceptable for parliament to wait another month to vote on the deal.
U.K. lawmakers were initially scheduled to have their say on the terms of Britain’s withdrawal from the EU last week but the prime minister delayed the vote, admitting she was likely to lose.
Source: CNBC
