European stocks slip to one-week low on trade war hit

European stocks slip to one-week low on trade war hit

Reuters  | Aug 26, 2019 09:07

European stocks slip to one-week low on trade war hit

By Amy Caren Daniel and Medha Singh

(Reuters) - Technology stocks pushed European equities to a one-week low on Monday as investors fled from riskier assets after another exchange of blows between the United States and China over trade at the end of last week.

U.S. President Donald Trump on Friday hit back at a new round of Chinese tariffs by heaping an additional 5% duty on some $550 billion in targeted Chinese goods and demanded that U.S. companies move their operations out of China. [nL4N25J3II]

Losses in Europe were not as dramatic as those in Asia overnight, after Trump on Monday said China had contacted U.S. trade officials overnight to say they wanted to return to the negotiating table.

But after falling half a percent at opening to hit its lowest level since Aug 16, the pan-European STOXX 600 index (STOXX) was down 0.33% by 0755 GMT.

"It's exactly according to our base case scenario which is that trade war will continue to escalate, that's also the reason why we don't put too much value to the latest comments," said Teeuwe Mevissen, a senior market economist at Rabobank.

"We don't see a solution in the short term."

Trading volumes were thinned out by a UK holiday (FTSE), but the declines were broad-based, with the technology index (SX8P), the most exposed to tariffs, the biggest loser with a 0.59% fall.

European stocks have been volatile throughout August and worries the U.S.-China conflict will force the economy into recession currently have the STOXX on course to lose around 4%. On the other hand, investors continue to expect major central banks to step in to counter the impact.

Federal Reserve Chair Jerome Powell on Friday pledged to "act as appropriate" to keep the U.S. economy healthy, although he stopped short of committing to rapid-fire rate cuts.

In other corporate-relevant newsflow, German real estate stocks came under pressure after a report that Berlin's city government planned to cap rents. Deutsche Wohnen (DE:DWNG) slid 3.3%, while Vonovia (DE:VNAn) fell 2%.

Ray-Ban maker EssilorLuxottica (PA:ESLX) rose 1.15% to hit a record high after Reuters reported U.S. hedge fund Third Point LLC had built a stake in the company.

Related News

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (India) English (Canada) English (Australia) English (South Africa) English (Philippines) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Português (Portugal) Polski Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 简体中文 繁體中文 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
Saving Changes


Download the App

Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors. is better on the App!

More content, faster quotes and charts, and a smoother experience is available only on the App.