European Stocks Drop as Traders Weigh Fiat's New CEO, Trade War
(Bloomberg) -- European equities retreated at the open as Fiat dropped on the news of a change in chief executive and as investors considered President Donald Trump’s new tariff threats.
The Stoxx Europe 600 Index declined 0.3 percent, with the automakers and travel sectors pacing the retreat. Fiat Chrysler Automobiles NV fell 4 percent after Mike Manley was named CEO to replace Sergio Marchionne, whose health declined suddenly and unexpectedly after shoulder surgery.
Investors are preparing for a busy week of corporate earnings, with Ryanair Holdings Plc posting a 20 percent drop in first-quarter profit and Royal Philips NV reporting a 9.8 percent rise in second-quarter profit. Geopolitics, however, also remain in focus as Trump lashed out against Iran, warning of unspecified “consequences” if counterpart Hassan Rouhani continues threatening America. Trump also said last week that he’s “ready to go” with additional tariffs and that China, the European Union and others have been manipulating their currencies.
“Despite Friday’s selloff, markets in Europe are still well above their lowest levels this year, which means that investors still don’t appear too concerned for now,” said Michael Hewson, chief market analyst at CMC Markets UK. “However, that could change in the coming days, especially if there’s no sign of the U.S. ratcheting down its rhetoric, or the EU and China institute retaliatory measures to any new U.S. measures.”
The biggest Spanish equity exchange-traded fund saw the highest inflows in more than four years last week as investors warmed to the new government and as concerns about the trade spat and Italian politics receded.
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