European Stocks Drop on UkraineTensions, Chinese Factory Data


European Stocks Drop on UkraineTensions, Chinese Factory Data

European shares fell on Monday after a report showed Chinese manufacturing slowed and tensions in Ukraine enhanced haven-value for gold and government bonds.

The benchmark Euro STOXX 50 index of the euro zone slipped 1.36% at 3,134.55 as of 0848 GMT, after Chinese factory output data was shown to have contracted for a fourth straight month in April.

The report reinforced the notion that the second-largest economy in the world is still reducing the pace of growth and pulled down Asian stocks overnight.

“The crisis between Russia and Ukraine and the sluggish Chinese data which confirm a slowdown in growth are the two big negative catalysts for markets,” Lionel Jardin of Paris-based Assya Capital is quoted by Reuters as saying.

The analyst added that the stocks would have suffered a bigger blow by now were it for the fact that a European Central Bank meeting scheduled for this week is going to take place and investors are hoping for the announcement of new measures.


The Stoxx Europe 600 Index closed down 0.3% to 336.89 after losing as much as 0.9%. The index added 1.3% last week, its largest run in a month, against the backdrop of revived mergers-and-acquisitions activity.

The volume of shares traded in Stoxx 600 firms was 64% below the 30-day average.

National blue-chip measures reversed in 13 of the 16 markets in Western-Europe that opened on Monday, according to Bloomberg. France’s CAC 40 advanced 0.1% while DAX of Germany lost 0.3%. Markets in the UK were closed for a public holiday on Monday.

China’s purchasing manager index rose to 48.1 in April according to estimates by HSBC Holdings Plc and Markit Economics. Economists had forecasted the gauge would add 48.4 from 48 in March. If the index is below 50, it implies contracted factory output.

Credit Suisse lost 2.3% to 27.40 Swiss francs.

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