EUROPE MARKETS: European Stock Markets Fall As Oil Producers Surge And Airlines Tumble On Saudi Attack
September 16 2019 - 5:30AM
Dow Jones News
By Steve Goldstein, MarketWatch
European stock markets fell on Monday as traders reacted to the
news of the attack that took half of Saudi Arabia's oil output
offline, sending oil producers much higher while airlines
struggled.
The broader Stoxx Europe 600 fell 0.63% to 389.31 in a move that
masked a major split.
Majors like BP (BP.LN) (BP.LN) and Royal Dutch Shell (RDSA.LN)
(RDSA.LN) rallied as explorers including Aker BP (AKERBP.OS)
surged.
Airlines including Air France-KLM (AF.FR) that are sensitive to
jet fuel costs tumbled, as did cruise operator Carnival (CCL.LN)
(CCL.LN) . Banks that have rallied of late also dropped, with
Deutsche Bank (DBK.XE) and Commerzbank (CBK.XE) lower.
The German DAX weakened 0.65% to 12387.81, the French CAC 40
fell 0.78% to 5611.15 and the U.K. FTSE 100 fell 0.36% to
7341.03.
Oil prices were off the day's highs but still strong, with Brent
crude oil futures up over $5 a barrel, a gain of about 9%.
"To take out over 5% of global supply (in the country with the
bulk of 'spare capacity') in a single strike - a volume exceeding
cumulative non-OPEC supply growth over 2014-2018 - is highly
worrying," said Jon Rigby, an analyst at UBS.
"While U.S.-China trade and U.S. oil supply growth have been the
primary price drivers we see a return of the political risk premium
as the market has been arguably complacent about risk events," he
said, adding its upside scenario would see oil getting to $80.
U.S. stock futures were weaker as well, while the yield on the
10-year fell 4 basis points to 1.86%.
Outside of the big oil news, H&M shares (HM-B.SK) fell 1.9%
after climbing over 50% over the last 12 months. The Swedish chain
reported a 12% rise in third-quarter sales and said it had
well-receiver summer collections and increased market share.
(END) Dow Jones Newswires
September 16, 2019 05:15 ET (09:15 GMT)
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