By Carla Mozee, MarketWatch
LONDON (MarketWatch) -- European stocks fell Monday, with poor
data from Asia and bleak comments about the eurozone prompting
investors to push the equity market away from multiyear highs.
In addition to weak updates from Asia's two largest economies,
figures from Germany released Monday showed industrial production
in Europe's biggest economy expanded less than expected in October.
Output rose by 0.2%, missing a 0.3% forecast from economists polled
by The Wall Street Journal.
Ewald Nowotny, a member of the governing council at the European
Central Bank, said Monday the eurozone is undergoing "massive
weakening" and that inflation could fall even further in the first
quarter of 2015. The eurozone is the weak spot in the global
economy, and it's worth the ECB discussing government-bond
purchases to aid the currency union, Nowotny said, according to
media reports.
Markets: The euro (EURUSD) fell to its lowest level against the
dollar since August 2012 on Monday following Nowotny's comments in
Frankfurt. The shared currency fell to as low as $1.2252, down from
$1.2289 on Friday. Germany's DAX 30 was down 0.3% at 10,059.60.
The Stoxx Europe 600 dropped 0.4% to 349.66, in broad-based
losses led by the consumer-products and basic-materials groups. The
index on Friday jumped by 1.8% to 350.97, marking its strongest
closing level since early January 2008.
But this week started with losses after a report showed imports
into China -- a major buyer of commodities -- unexpectedly fell in
November by 6.7%. That compares with expectations for 3% growth.
Among miners, Anglo American PLC fell 1%, Rio Tinto PLC 0.(RIO)
gave up 0.6%, and Glencore PLC moved 0.5% lower.
"While lower commodity prices may have placed a downward bias on
the import number, the extent of the negative surprise, coupled
with the overvalued [yuan], suggests there was in fact a real
element of much slower domestic demand," said Sue Trinh, senior
currency strategist, at RBC Capital Markets, in a note.
In Paris, the CAC 40 declined 0.4% to 4,400.26, while the U.K.'s
FTSE 100 fell 0.7% to 6,696.14. Italy's FTSE MIB was pulled 0.3%
lower to 20,028. After trading closed on Friday, Standard &
Poor's cut Italy's long- and short-term credit rating to a notch
above junk status, to BBB-/A-3 from BBB/A-2. The move reflects
recurring weakness in Italy's real and nominal GDP performance,
which the agency said is "undermining the sustainability of the
country's public debt."
Meanwhile, the Japanese economy during the third quarter shrank
more than initially estimated, contracting an annualized 1.9% from
the previous three-month period. The government last month
estimated contraction at a rate of 1.6%.
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