EUROPE MARKETS: Europe Stocks Trade Lower As German Economy Heads Toward Recession
August 14 2019 - 5:57AM
Dow Jones News
By Steve Goldstein, MarketWatch
Europe stocks traded lower on Wednesday after data showing the
Continent's largest economy contracted and eurozone industrial
production declined.
After halting a two-day losing run on Tuesday, the Stoxx Europe
600 declined 0.12% to 371.96, with banks including UniCredit
(UCG.MI) and Danske Bank (DANSKE.KO) lower.
The U.K. FTSE 100 gained 0.1% to 7258.5, the German DAX fell
0.3% to 11714.89 and the French CAC 40 weakened 0.3% to
5346.88.
U.S. stock futures pointed to a decline for the Dow Jones Industrial Average at the open.
What's moving markets
The state of the global economy returned to focus a day after
relief from the U.S. government delaying tariffs on Chinese
consumer products.
Germany's economy shrank by 0.1% in the second quarter
(http://www.marketwatch.com/story/german-economy-shrinks-amid-trade-concerns-auto-woes-2019-08-14),
according to data released by Destatis, the statistics agency.
"The external backdrop is set to remain challenging due to
persistent weakness in global demand amid re-escalated U.S.-China
trade tensions and the increased likelihood of a no-deal Brexit,"
said Iaroslav Shelepko, an economist at Barclays. " Given varied
risks, a gloomy global trade outlook and elevated uncertainty, we
expect the economy to post another mild decline in the third
quarter and therefore enter a technical recession even before
Brexit and U.S.-E.U. trade risks are due to crystallize."
The economy in the eurozone as a whole rose 0.2%, Eurostat
reported, with Spain's economy rising 0.5%, France's economy
improving by 0.2% and Italy's economy staying flat.
Perhaps more concerning to markets was the 1.6% downturn in
eurozone industrial production in June, as well as the softest
Chinese industrial production growth in 17 years.
Focus stocks
Schindler Holding fell 4% as the elevator maker said markets may
"slightly weaken over the remainder of the year" alongside a 2.8%
decline in first-half operating profit. Its guidance for an annual
net profit between 900 million and 940 million francs compares to
consensus around 970 million francs. Rival ThyssenKrupp (TKA.XE)
fell 3.4%.
Straumann Holding (STMN.EB) shares rose 3.3% as first-half
earnings for the dental implant maker came in ahead of forecast and
its sales guidance was upgraded.
Admiral Group (ADM.LN) shares advanced 4% as the British insurer
reported a 4% rise in first-half pretax profit and an increase in
its dividend.
Drugmaker Sanofi (SAN.FR) saw its shares rise 2% as UBS upgraded
the company to buy from neutral, saying the pipeline of drugs
"looks lackluster" but isn't empty, and that it's underperformed
rivals like Novartis (NOVN.EB) , Roche (ROG.EB) and Johnson &
Johnson (JNJ) .
(END) Dow Jones Newswires
August 14, 2019 05:42 ET (09:42 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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