Europe Markets: European stocks slammed by economic concerns
By Wed, Oct 2, 2019
European stocks on Wednesday were engulfed in red on concerns over the state of the U.S. economy, the world’s largest.
Now back in negative territory over the last 52 weeks, the Stoxx Europe 600 SXXP, -1.41% tumbled 1.22% to 383.27.
The German DAX DAX, -1.26% slumped 1.06% to 12134.38, the French CAC 40 PX1, -1.61% slumped 1.45% to 5516.46 and the U.K. FTSE 100 UKX, -1.70% dropped 1.48% to 7251.33.
U.S. stock futures ES00, -0.69% were weaker after the 343-point downturn for the Dow DJIA, -1.28% industrials on Tuesday, when the Institute for Supply Management reported a downturn in its closely watched U.S. manufacturing index to the worst level in more than a decade.
Germany’s leading economics research institutes jointly lowered their economic forecasts, now seeing 0.5% growth in Europe’s leading economy instead of a previous forecast for 0.8% growth. They also cut their view for growth next year to 1.1% from 1.8%. The DIW, Ifo Institute, IfW, IWH and RWI cited falling world-wide demand for capital goods as well as political uncertainty and structural changes in the automotive industry for the downgrade.
“The global manufacturing recession is global, in that it includes the U.S. Some of it comes from China, and some of it comes the White House but it’s pretty global and while Germany is suffering worse than anyone else, even the U.S. is feeling it,” said Kit Juckes, global fixed income strategist at Société Générale.
Among the few risers was Grenke GLJ, +5.73%, up 6% as the financing firm raised its full-year new-business forecast and reported increasing margins.
Flutter Entertainment FLTR, +20.12% shot up 18% as the bookmaker announced it will buy Canada’s The Stars Group TSG, +2.20% in a stock swap in which it will control nearly 55% of the combined company. Flutter said the deal will lift underlying earnings per share by at least 50% in the first full year following completion, and its combined revenue of £3.8 billion will make it the largest online betting and gaming operator.
Tesco TSCO, +0.46% rose 1% after the supermarket group announced a first-half rise in pretax profit and the departure of its chief executive. Read more on Tesco.
Shares of Metso METSO, -6.07% slumped 6%, the worst performer in the Stoxx Europe 600, as Credit Suisse downgraded the Finnish machinery company to underperform from neutral.
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