European Stocks Drop at Open as Miners Jump, Financials Fall

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European equities retreated at the open as banks and insurers fell amid concerns about global growth and trade talks. Mining shares led the gains on the weaker U.S. dollar.

The Stoxx Europe 600 Index fell 0.2 percent. The FTSE 100 Index added 0.3 percent on the weaker pound even as Prime Minister Theresa May gambled on a desperate bid to get her Brexit deal approved by Parliament, as a standoff with the European Union drives Britain to the brink of an economically challenging no-deal divorce.

“In the U.K., timescale and options are narrowing and the need to go cross-party to get a deal through is rising,” said Chris Bailey, a European strategist at Raymond James.

European equities have enjoyed a powerful recovery this year, buoyed by the dovish central banks. While investors were encouraged by the Federal Reserve’s decision yesterday to abandon projections for a resumption in interest-rate hikes this year, they mulled global risks to growth that defined the Fed’s decision. Forecasters in the Bloomberg poll remain cautious on the outlook for European equities and expect the Stoxx 600 to lose 6 percent from Wednesday’s close through the end of the year.

Concerns are also mounting about the prospects of the trade agreement as President Donald Trump said he’ll keep tariffs on China until he’s sure Beijing is complying with any trade deal.

To contact the reporter on this story: Ksenia Galouchko in London at kgalouchko1@bloomberg.net

To contact the editors responsible for this story: Blaise Robinson at brobinson58@bloomberg.net, Jon Menon

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