European shares down on weak China data
On Wednesday European shares lost ground on concerns of a slowing Chinese economy, declines in luxury and travel stocks and an increasing UK inflation kept the main indexes under pressure.
The benchmark STOXX 600 index lost 0.1% in morning trade, and was down about 2% from the record high in mid-August.
Asian stocks turned to negative territory after data ilustrated China’s factory and retail sectors wavered in August with production and sales growth reaching one-year lows after new coronavirus outbreaks and supply troubles.
Retail and travel & leisure stocks lost most ground among those in Europe, falling almost 1%, on worries over the new COVID-19 outbreak in China’s Fujian province and signs of stricter regulations in Macau, the world’s largest gambling centre. French luxury goods makers LVMH and Kering lost more than 3%.
While optimism about a constant European economic rebound continues, the STOXX 600 is on course to end its sevenmonth winning streak in September, as investors grow nervous over global growth and monetary policy expectations.
UK’s FTSE 100 moved lower and mid-cap stocks dropped 0.3% after data showed British inflation touched a more than nine-year high last month.
Fashion retailer H&M lost 2.8% as quarterly sales increased less than expected, while Zara owner Inditex fell 1.0% even as sales approached pre-pandemic levels. Swedish Match gained 3.4% after the tobacco and nicotine products maker revealed plans to spin off its U.S. cigar business to shareholders and list it on the stock market.
Dutch online food delivery company Just Eat Takeaway lost 4.0% after the Financial Times reported that UK rival Deliveroo and Amazon will offer free delivery to Prime subscribers. Deliveroo increased by 0.9%.
Oil stocks were the top gainers as crude prices increased after industry data showed a larger than expected drawdown in crude oil stocks in the United States.
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.