Global Stocks Fall Amid Rising Fears of Economic Slowdown
02 October 2019 - 6:58PM
Dow Jones News
By Max Bernhard
-- European and Asian stocks lower
-- Industrial stocks lead the drop
-- Investors await ADP Jobs data
Global stocks fell Wednesday, led by drops in banks and
industrial companies as investors expressed increasing worries of a
global economic slowdown.
The Stoxx Europe 600 opened down 0.9%, with Germany's DAX 1%
lower and the U.K.'s FTSE 100 down 1.2%.
Markets continued to react to disappointing economic data
published Tuesday -- showing manufacturing activity was at its
lowest point in a decade in the U.S. The figures came on top of
recent downbeat data from the European Union, China, and Japan.
Steel giant ArcelorMittal and Finnish construction machinery
maker Konecranes were both among the biggest losers in Europe,
falling 2.5% and 3% respectively.
If the manufacturing slowdown spreads to the still robust
service sector, this would increase pressure on the U.S. Federal
Reserve to cut rates again in October, said Stefan Schilbe, HSBC
Germany's chief economist, in a note.
Bank stocks in Europe fell Wednesday, with the Euro Stoxx Banks
index down 1.0%, reflecting unease about falling bond yields, which
tend to crimp lender profits. Banks' performance is also seen as
highly correlated with economic growth. Swiss banks UBS Group and
Credit Suisse Group were both down more than 1.5%.
Among individual stocks, shares in U.K. bookmaking business
Flutter Entertainment rose 14% after it agreed to merge with Stars
Group, creating an online betting giant worth more than $11
billion. Shares in supermarket chain Tesco were up 1.3% after it
said profit rose in the first half of fiscal 2020. It also
announced Chief Executive Dave Lewis would step down next
summer.
In Asia, Korea's Kospi traded nearly 2% lower following news
that North Korea fired at least one missile off its east coast. The
move, seen as a show of strength, came after Pyongyang said it
would resume official nuclear talks with the U.S. In Japan, the
Nikkei fell 0.5% and Hong Kong's Hang Seng was down 0.2%. Mainland
Chinese stock markets were closed for a holiday.
In commodities, oil futures for Brent crude rose 0.2% to $58. 97
a barrel.
The yield on U.S. 10-year Treasurys edged higher to 1.645%, from
1.638% Monday. Bond yields and prices move in opposite
directions.
Looking ahead, investors were eyeing the U.S. ADP National
Employment Report for signs of any cracks in the job market. Ford
Motor Co. reports third-quarter sales.
Write to Max Bernhard at Max.Bernhard@dowjones.com
(END) Dow Jones Newswires
October 02, 2019 04:43 ET (08:43 GMT)
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