UKX FTSE 100 Index

By Victor Reklaitis, MarketWatch

Bayer leads stocks lower after court ruling

European stocks lost ground Monday with Turkey's perilous financial condition weighing on sentiment.

What are markets doing?

The Stoxx Europe 600 dropped by 0.5% to 383.86, after ending 1.1% lower on Friday as worries about Turkey took a toll.

The pan-European gauge is showing a fall of 1.4% for the year to date.

Germany's DAX 30 shed 0.7% to 12,337.86, while France's CAC 40 gave up 0.5% to 5,388.31. The U.K.'s FTSE 100 fell 0.6% to 7,617.98.

The euro changed hands at $1.1370, down from $1.1412 late Friday in New York.

What is driving the market?

European stocks have been selling off on fears about potential contagion from Turkey's problems, especially in the banking sector.

The Turkish central bank pledged (http://www.marketwatch.com/story/turkeys-central-bank-fails-to-soothe-investors-2018-08-13) to provide "all the liquidity the banks need" in a statement Monday. It also said banks would be able to borrow foreign-exchange deposits from the central bank at a one-month maturity and one-week maturities. Analysts said Turkey's reluctance to raise interest rates stood out.

Meanwhile, shares in Bayer AG (BAYN.XE)dived 11% for the Stoxx Europe 600's biggest drop. A jury has ordered the German chemical company's Monsanto business to pay $289 million in a landmark lawsuit (http://www.marketwatch.com/story/bayers-monsanto-hit-by-289-million-verdict-2018-08-13) over whether exposure to two of its powerful weed killers -- Ranger Pro and Roundup -- caused cancer.

What are strategists saying?

"Clearly Turkey's situation is another global risk," said Konstantinos Anthis, head of research at ADS Securities, in a note.

"Even though the country itself has limited ties with the rest of the word, a spreading of the crisis to Europe via its banks' exposure is a major concern."

Other stock movers

Shares in GAM Holding AG fell 4% after the Swiss money manager on Friday said it would liquidate $7.3 billion of its funds (https://www.wsj.com/articles/gam-to-liquidate-7-3-billion-of-funds-after-traders-suspension-1533924082?mod=mktw) following the suspension of a top bond fund manager.

On the upside, shares in United Internet AG (UTDI.XE)jumped 6% after the German internet services provider posted higher-than-expected earnings and backed its outlook.

(END) Dow Jones Newswires

August 13, 2018 04:09 ET (08:09 GMT)

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