European stocks slip as oil prices fall
European stock markets were mixed Tuesday afternoon as oil prices fell and financial reports disappointed.
The pan-European Stoxx 600 was down 0.39 percent, with major bourses mixed and most sectors in the red.
Autos, banks and basic resources continued to move higher during the morning session despite all other sectors slipping.
The FTSE was down 0.86 percent after a survey by the CBI (Confederation of British Industry) and PwC out Tuesday revealed deteriorating business sentiment in the U.K., with uncertainty clouding the country’s future after the vote to leave the European Union. This comes ahead of a speech due by Prime Minister Theresa May later Tuesday in which she will relaunch her leadership after a disappointing snap election result in June.
Oil prices fell into negative territory after a strong start in early deals. Brent crude was trading at $46.39 per barrel while U.S. West Texas crude was trading at $43.94 per barrel, both down around a percent. Speaking to CNBC at the World Petroleum Congress in Istanbul Monday, Russian Energy Minister Alexander Novak stressed the flexibility of an agreement between major producers to curb supply in an attempt to buoy prices.
The dip dragged the sector down by 0.63 percent while other sectors tumbled in tandem.
Media was down 0.73 percent, with Pearson taking the bottom spot on the European benchmark. The publisher was trading up 2.5 percent in opening deals after announcing plans to raise £776 million ($999 million) by selling a 22 percent stake in Penguin Random House. However, by afternoon trade it was down 5.4 percent.
Food and beverages and household goods also slipped lower. Marks & Spencer reported a 1.2 percent fall in household and clothing sales for the three months to July 1, causing the stock to dip 4.7 percent. Chief Executive Steve Rowe said the results were in line with expectations. In the U.S., PepsiCo is also due to report second-quarter earnings early Tuesday.
Recruitment firms Randstad and Adecco also dropped by around 2.5 percent each after analysts at Deutsche Bank cut ratings for the world’s two largest staffing companies citing disappointing European employment rates.
On the other side, travel firm Tui climbed higher after selling its remaining 8.5 million shares in shipping container business Hapag-Lloyd for 244.4 million euros.
Politics at play
The Russia-linked scandal surrounding the White House rumbles on, with the New York Times reporting Monday that Donald Trump Jr. met with a Russian lawyer with damaging information on then-presidential candidate Hillary Clinton, aware that the Russian government was attempting to support his father’s campaign. The White House played down the importance of the meeting.
Also on the agenda Tuesday, Brussels is hosting a meeting of EU finance ministers (ECOFIN). IMF (International Monetary Fund) Managing Director Christine Lagarde will be speaking in Dubrovnik, Croatia, at a conference.
Source: CNBC
