Thursday, 9 Jul 2020

European shares dip after Wall Street's latest rout

LONDON (Reuters) – European shares opened in negative territory on Friday, following in the footsteps of U.S. and Asian markets hit by the threat of a U.S. government shutdown and of further hikes in U.S. borrowing costs.

The pan-European STOXX 600 index was down 0.6 percent at 0852 GMT and continued its slide toward lows not seen since the end of 2016.

Most European bourses and industry indexes were in the red after the S&P 500 fell overnight, heading for its worst quarter since the dark days of late 2008.

The Nasdaq also continued its slump, down 19.5 percent from its August peak, just shy of what commonly constitutes a bear market.

U.S. futures also pointed out to another session of losses on Wall Street.

“Another week draws to a close in the markets and, as we approach the end of the year, it’s looking increasingly unlikely that a late Santa surge is going to save what has been an otherwise horrible quarter,” commented Craig Erlam, senior market analyst at Oanda.

On the bright side, Delivery Hero (DHER.DE), the world’s biggest online food delivery firm, saw its shares surge 10 percent after announcing the sale of its German operations to Netherlands-based Takeaway.com.

The latter also jumped 23 percent, on track for its biggest ever one-day gain. Other stocks of Europe’s listed food-delivery companies rose, with rival Just Eat adding 3.4 percent.

Still on the merger and acquisition front, France’s Spie was also one of the session’s few winners, (SPIE.PA) rising 4.8 percent after announcing the sale of a German subsidiary.

Adding more gloom to the European banking sector, which has already fallen 28.5 percent so far in 2018, Danske Bank (DANSKE.CO), at the center of an international investigation into alleged money laundering, cut its 2018 outlook for the second time this year. The Danish lender was down 3.3 percent.

Refinitiv data showed on Friday that European equity raising slowed sharply in 2018, making it the biggest drag on falling global activity as political uncertainty and growth concerns made it harder to persuade investors to buy stock.

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