European shares edge down as trade fears make comeback

Reuters

Published Mar 07, 2018 09:10

European shares edge down as trade fears make comeback

By Julien Ponthus

LONDON (Reuters) - European shares opened lower on Wednesday after the resignation of Donald Trump's economic adviser Gary Cohn, seen as a bulwark against protectionist forces within the U.S. government.

At 0857 GMT, the pan-European STOXX 600 (STOXX) index was down 0.4 percent while Wall Street futures were trading in negative territory.

"Gary Cohn’s departure rattled markets and equity markets look set to fall on the open. Stocks have declined overnight in Asia and it’s looking like it will be red today on the open", Neil Wilson, a Senior Market Analyst at ETX Capital told his clients in a morning note.

Most European markets and sectors were down, with Germany's DAX (GDAXI) losing 0.5 percent.

German carmakers, which are expected to suffer from new U.S. tariffs, took a hit. Volkswagen (DE:VOWG_p) lost 1.6 percent and Daimler (DE:DAIGn) 1.3 percent, the second and third worst performance of the German blue chip index.

Still in Germany, postal and logistics group Deutsche Post DHL (DE:DPWGn) was down 2.1 percent after reporting 2017 results.

Oil prices fell and London metals slipped, weighing on the energy (SXEP) and basic materials (SXPP) sectors, which were down 1.4 percent and 0.8 percent respectively.

The advertising sector retreated after the Financial Times said P&G (N:PG) would cut agency spending by 1.25 billion dollars over three years. France's Publicis (PA:PUBP) and Britain's WPP (L:WPP) fell 1.9 percent and 1.6 percent respectively.

British plane engine maker Rolls-Royce (L:RR) was the best Stoxx index performer, surging 8.5 percent after saying it remained on track to meet its financial goals for 2020.

Second came Smurfit Kappa (I:SKG), after U.S. peer International Paper (N:IP) revealed the takeover offer it made for Europe's largest paper packaging producer was worth 8 billion euros.

Shares in ADP (PA:ADP) came in third, up 2.3 percent, after a media report said the government would go ahead with plans to privatise French airport operator ADP and sell its 50.6 percent stake entirely.