Europe close: Chinese data knocks stocks off their perch

European stocks fell on Thursday as weak Chinese trade data weighed on the basic resources sector.

The benchmark Stoxx Europe 600 index was down 0.87%, Germany’s DAX was off 1.04% and France’s CAC 40 was 1.06% weaker.

Meanwhile, oil prices steadied, having slipped back after OPEC said in the previous session that production in September rose to its highest level in eight years. West Texas Intermediate was flat at $50.17 a barrel and Brent crude was up 0.1% at $51.86.

Basic resources suffered the brunt of the selling, with the Stoxx 600 sub-index for the sector down 2.94% following the release of disappointing Chinese trade data.

Figures released earlier showed Chinese exports and imports in September missed expectations, with exports down 10% in dollar terms year-on-year and imports down 1.9%. Economists had been expecting a 3% decline in exports and a 1% rise in imports.

In yuan terms, exports were 5.6% lower on the year, while imports were up 2.2%.

Meanwhile, investors also continued to digest the minutes of the Federal Reserve’s 20-21 September meeting. The minutes, released on Wednesday, showed it was a “close call” to keep rates on hold, with policymakers generally of the view that a move higher could be on the cards within months if the economy keeps on track.

Lee Wild, heady of equity strategy at stockbroker Interactive Investor, said the market had already pencilled in a December hike, so finding out that September was a close call was not a needle mover.

“Fears about the global economy are. Overnight data shows Chinese exports fell 10% last month, much more than expected. Imports in dollar terms were down, too, proving August's surprise increase was a one-off. Expect the Chinese currency to devalue further, which could have a major impact on demand for commodities and imported goods.

“Oil prices are already lower Thursday, although figures showing producers are pumping like crazy to beat a possible cut in output is hurting here. An extra 220,000 barrels a day left the ground last month as oil nations fill their boots before OPEC’s meeting in Vienna next month. If a cut doesn't happen - and there are no guarantees with OPEC - prices will fall much further.”

In corporate news, Unilever was under pressure after a storm broke over a supermarket pricing dispute over Marmite and several other of its brands, although the group reported solid underlying sales amid tough third-quarter conditions.

The dispute was with Tesco, whose shares declining on Thursday.

Elsewhere, French supermarket operator Groupe Casino was lower despite reporting a rise in third-quarter sales.

Shares in Deutsche Bank fell following reports the lender has introduced a hiring freeze as it looks to cut costs.

Subscription broadcaster and broadband provider Sky was in the red after saying first-quarter group revenue rose 7%, while WH Smith gained ground after reporting an 8% rise in pre-tax profit for the year to the end of August.

ProSiebenSat.1 Media fell even after it lifted its 2016 and 2018 sales projections.