European stocks were lower as trade war fears continue
The pan-European STOXX 600 index was around half a percent lower during early afternoon trade, with sectors and major bourses largely in negative territory.
Europe’s autos and basic resources sectors, with the heavy exposure to China, led the losses, both down more than 1%.
Despite the news that Chinese Vice Premier Liu He would travel to Washington on Thursday, fears have been growing that the proposed trade deal between the two economic powers is unravelling.
At individual stock level, cigarette maker Imperial Brands slumped toward the bottom of the European benchmark after it reported weaker-than-expected sales of its e-cigarettes on Wednesday, sending its shares to their lowest level this year. The British company’s shares were down more than 5% during early afternoon deals.
British broadcaster ITV also saw its shares trading 5% lower on Wednesday, after it reported lower revenues ahead of the launch of its streaming service.
Meanwhile, Siemens surged toward the top of the index after the German company posted better-than-expected operating profit on Wednesday. Shares gained 4.5% after the company’s results showed profit rose 7% to 2.4 billion euros ($2.69 billion) in the three months to March 31, beating estimates of 2.24 billion euros in an Infront data poll.
Commerzbank reported first-quarter revenue of 2.16 billion euros, down 2.8% compared to the same period last year. The bank’s operating profit fell 5.6% to 244 million euros. Shares traded almost 2% lower.
Stateside, investors will continue to monitor developments between Washington and Beijing closely after the Dow dropped 470 points overnight in its sharpest decline since early January, while the S&P 500 shed 1.65% and the Nasdaq Composite dropped 1.96%.
In Europe, political uncertainty continued as the U.K. Conservative government resumed its negotiations with the main opposition Labour Party in bid to break parliamentary deadlock over the U.K.’s departure from the European Union. Sterling slumped to around $1.30 on Wednesday amid reports that talks to break the deadlock may soon collapse.
Meanwhile, Italy accused the EU of prejudice after grim economic forecasts suggested the Italian economy would grow 0.1% this year, lagging the rest of the bloc.