European markets fall ahead of crucial weekend Brexit showdown
European markets closed lower Friday afternoon as traders await signals as to whether a Brexit deal agreed between the U.K. and EU will pass muster with British lawmakers in parliament.
The pan-European Stoxx 600 ended provisionally lower by 1.15 percent, with autos trading down 1.45 percent on the back of a profit warning from Renault, while basic resources added 0.33 percent.
U.K. Prime Minister Boris Johnson agreed a new Brexit deal which was unanimously backed by European Union leaders on Thursday, but must now fight to secure approval from British MPs (Members of Parliament) in a vote on Saturday if he is to succeed in taking Britain out of the bloc on October 31.
Northern Ireland’s Democratic Unionist Party (DUP), the coalition partner of Johnson’s ruling Conservative party, has affirmed that it will vote against the deal. The prime minister will need to secure the backing of hardline Brexiteers within his party along with 21 moderates he expelled from the party last month for voting to prevent a no-deal exit.
Some analysts are projecting a narrow defeat unless Johnson can manage the tall order of securing 37 votes from lawmakers outside his own ranks.
The British parliament’s Treasury Committee wrote to Finance Minister Sajid Javid urging him to publish updated economic forecasts of the cost of leaving under the proposed deal, Reuters reported Friday morning.
Market focus was also attuned to economic data from China, which showed growth in the world’s second-largest economy fell to its slowest since 1992.
Stocks on Wall Street were trading lower on Friday as investors monitored corporate earnings reports and digested the weak Chinese data.
Stocks on the move
Back in Europe, earnings season remained in focus, with French automaker Renault on Thursday cutting its 2019 revenue outlook and profit forecasts citing slowdowns in Turkey and Argentina. Renault shares plunged 11.68% Friday to drag the rest of the European automotive sector into the red.
At the top of the Stoxx 600, Swedish medical technology company Getinge surged 16 percent after its third-quarter profit exceeded expectations, demonstrating continued growth and improved margins.
Source: CNBC
