European stocks drop to two-we
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European stocks drop to two-week low on growth
Worries about U.S. bond markets signaling an impending recession and a still rumbling trade war between the world's two biggest economies sent European shares sinking further on Wednesday after a 3 percent drop on Wall Street.
The pan-European STOXX 600 (STOXX) was down 1.2 percent by 0830 GMT, hitting its lowest level since Nov 23, with Germany's DAX (GDAXI), France's CAC 40 (FCHI), and Britain's FTSE 100 (FTSE) all falling 1.3 percent.
Financials were the biggest drag on European shares as investors dumped sectors highly sensitive to economic growth. Europe's bank index (SX7P) fell 1.7 percent, in line with tech (SX8P) after the highly valued U.S. tech sector sold off.
German carmakers Daimler (DE:DAIGn), Volkswagen (DE:VOWG_p), and BMW (DE:BMWG) fell 0.5 to 0.8 percent, outperforming the DAX as investors digested what seemed a relatively positive outcome from auto executives' meeting at the White House.
President Trump pressed the carmakers to increase investments in the United States, something the executives said they planned to do but wouldn’t be able to if the administration went ahead with threatened tariffs.
White House economic adviser Larry Kudlow, among those in the meeting, said he did not think that car tariffs were imminent.
Shares in valve manufacturers Rotork (L:ROR) and Weir (L:WEIR), which supply the oil industry, tumbled 3 to 5 percent after U.S. energy services firm Schlumberger (N:SLB) gave a warning on Tuesday, saying a drop in fracking activity would hit its North America revenues.
Shares in Shire (L:SHP) jumped 4 percent at the open, then trimming gains to trade up 2 percent, after shareholders of Japan's Takeda approved the takeover of the London-listed pharmaceutical firm.
Broker notes hit some stocks. Hargreaves Lansdown (L:HRGV) fell 5.4 percent after Morgan Stanley (NYSE:MS) cut its rating to underweight.