European Stocks Drop as Automakers Lead Declines on Trade Woes
(Bloomberg) -- European equities fell, led by automakers, as investors frowned upon the lack of concrete details on U.S.-China trade talks.
The Stoxx Europe 600 Index retreated 0.5 percent following two days of gains. Bayer AG declined 0.9 percent. The FTSE 100 Index slid 0.3 percent as U.K. Prime Minister Theresa May is openly contemplating a Brexit “Plan B” amid growing signs that Parliament will reject the deal. UBS Group AG tumbled 2.8 percent.
European equities had enjoyed a reprieve from declines earlier this week amid optimism about U.S.-Chinese trade talks and as the U.S. stock market rallied. However, concern surrounding the partial U.S. government shutdown and the absence of details on the trade negotiations continue to weigh on sentiment ahead of the earnings-reporting season, which starts next week.
“It’s too early to shake off the worries we had before the New Year’s, as markets want to get more color on trade talks,” said Guillermo Hernandez Sampere, head of trading at German asset manager MPPM EK. “One thing is for sure: Markets will remain volatile for the time being and the risk-on environment hasn’t come back yet.”
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