European stocks set for triple-digit losses as Wall Street sell-off grips global markets

Big 5

European stocks are set to open sharply lower on Thursday, as a sell-off in U.S. equities dragged down global markets.

Britain’s FTSE 100 was seen opening 105 points lower at 7,046; Germany’s DAX down 250 points at 11,484; France’s CAC down 125 points at 5,088; and Italy’s FTSE MIB down 456 points at 19,187.

Around the world, equity markets have tumbled on the back of rising fears around global economic growth and rising interest rates.

The International Monetary Fund warned earlier this week that simmering trade tensions, such as those between the U.S. and China, could lead to a sudden deterioration in risk sentiment, triggering a broad-based correction in global capital markets and a sharp tightening of global financial conditions. Meanwhile, U.S. Treasury yields have this week climbed to multi-year highs, however they pared gains late into Wednesday’s trading session.

U.S. President Donald Trump on Wednesday once again criticized the U.S. Federal Reserve, calling the central bank “crazy” for its insistence on hiking rates. Trump also commented on the plunge in markets, calling it a “correction that we’ve been waiting for for a long time.”

Back in Europe, Brexit is largely in focus after the European Union’s chief Brexit negotiator, Michel Barnier, struck an optimistic tone on a deal for the U.K.’s eventual withdrawal from the bloc, saying an agreement was achievable as soon as next week.

Barnier stressed, however, that the U.K. remaining in the customs union would be the best possible solution to avoiding a hard border between the Irish mainland and Northern Ireland. Both the euro and the British pound bounced against the dollar on Barnier’s comments Wednesday, and were up 0.4 and 0.27 percent respectively on Thursday morning.

In corporate news, German carmaker BMW is investing $4.2 billion in its joint venture with Chinese firm Brilliance Auto, giving it a majority stake. On the earnings front, French auto parts maker Faurecia is set to release third-quarter sales numbers, while U.K. retailer WH Smith will post full-year preliminary results.

As for data, French inflation and British unemployment figures are due to be released on Thursday morning.

Source: CNBC