Sun, Jun 12, 2016 - Page 15 News List

Stocks in European markets tumble most since February

Bloomberg

European stocks plunged the most since the nadir of the February slump, as investors shunned risky assets before monetary-policy and political events later this month.

The STOXX Europe 600 Index lost 2.4 percent at the close of trading on Friday, deepening its worst weekly drop in a month to 2.5 percent. All but 16 stocks fell, with lenders in Italy and Greece among the worst performers. A gauge of eurozone stock volatility jumped 17 percent, extending its biggest weekly gain since January.

Investors are bracing for a slew of potential triggers in the next two weeks, amid signals that European Central Bank officials might sit tight on stimulus measures over the summer months.

The US Federal Reserve’s rate decision and the Bank of Japan’s policy statement are both due on Wednesday, followed by a June 23 referendum to determine Britain’s membership in the EU and Spain’s general election three days after that.

“Everybody seems angry about this market,” said Benno Galliker, a trader at Luzerner Kantonalbank AG in Lucerne, Switzerland. “It really looked like we could go to the upside, but now in Europe it seems everything is falling apart. Nobody wants to stay in the market with so many things coming up: the Fed, BOJ, Brexit vote.”

The STOXX 600 kicked off this week with gains amid a rally in oil shares and optimism the Fed would not raise rates prematurely, only to reverse direction mid-week as political uncertainty and concern over global growth took hold. The benchmark has struggled to maintain momentum in a rebound after surging 16 percent from its February low to an April 20 high. It has traded in a range of less than 25 points since March.

Among other shares active on corporate news, Deutsche Lufthansa AG dropped 5.6 percent after announcing the surprise departure of the firm’s chief financial officer Simone Menne. PSA Peugeot Citroen fell 1.6 percent after a report that 10 members of the Peugeot family might consider boosting their holding in the company.

London-based staffing company SThree PLC tumbled 8.4 percent after saying uncertainty stemming from Britain’s EU referendum has led to a slowdown in its UK business. Recruitment providers Hays PLC and PageGroup PLC slid more than 6 percent.

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