European shares lower
European shares inched lower on Wednesday as weak bank earnings and doubts over an interim U.S.-China trade deal spurred selling, although losses were limited by excitement over merger talks between Fiat Chrysler and France’s PSA.
By 0930 GMT, the pan-European STOXX 600 index was down just 0.1%, with banks . leading losses after disappointing results from some of the region’s top lenders. Deutsche Bank fell 6%, putting it at the bottom of the benchmark index, as it reported a loss for the second consecutive quarter due to the costs of its wide-ranging global restructuring.
The euro zone’s biggest lender, Santander, slid 2% as net profit fell 75% due to one-off charges in the UK, while Swiss lender Credit Suisse lost over 3% after issuing a cautious 2020 outlook.
Expectations had been low going into the European corporate earnings season, and after three weeks the overall picture has proved better than expected, with most companies modestly beating estimates.
Trade-sensitive tech and commodity-linked stocks took a hit as concerns over the U.S.-China trade pact resurfaced after a U.S. administration official told Reuters the deal might not be completed in time for the leaders of the two countries to sign in Chile next month.
Auto stocks hit their highest level in nearly six months after Italian-American carmaker Fiat Chrysler confirmed it was in merger talks with French rival PSA (PEUP.PA) on a deal that would reshape the global industry.
Shares of both companies rose between 7% and 8%, with Peugeot hitting an 11-year high. Shares in another French carmaker, Renault, which was in talks with Fiat earlier this year about a similar deal, slid 3.5%.
Asian shares slipping from three-month highs, as the prospect of a rate cut by the Federal Reserve was countered by worries a Sino-U.S. first-stage trade deal could be delayed. MSCI’s broadest index of AsiaPacific shares outside Japan shed 0.33% from Tuesday’s threemonth high while Japan’s Nikkei lost 0.57% after hitting a one-year high the previous day.
This article was compiled by BOV Asset Management Limited, a member of the BOV Group. BOV Asset Management,TG Complex, Suite 2, Level 3, Brewery Str., Mriehel BKR 3000. Email: infoassetmanagement@bov.com Internet address: www.bovassetmanagement.com. BOV Asset Management is licensed by the MFSA.