Europe open: Markets jittery over Fed, Brexit fears
European markets had a touch of the jitters on Monday morning, with all indexes sliding ahead of the US Federal Reserve’s June meeting later in the week and with ten days to go until Britain’s European Union referendum.
The pan-European Stoxx 600 was down 1.08% at 329.32, with airlines dragging the sub-indexes, down by 3.6%.
In London, the FTSE 100 was down 0.3% at 6,097.58, while in Frankfurt the DAX was down 1.09% at 9,727.76 and in Paris the CAC 40 lost 0.85% at 4,270.14.
The European benchmarks were tracking their Asian counterparts, with stocks in that region falling the most in more than two months and investors sending the safe-haven yen soaring.
Analysts there were also citing key central bank meetings and Brexit fears as being behind the risk-off pattern.
Sterling fell to an eight-week low against the greenback early on Monday, having been in a downward spiral since a poll after markets closed on Friday gave the ‘out’ campaign a ten point lead.
Two more polls published over the weekend were split between the ‘in’ and ‘out’ votes.
The greenback was last trading 0.4% stronger at $1.42 per £1.
In addition to the much-anticipated Fed meeting, the Bank of England, Swiss National Bank and the Bank of Japan are all expected to stand pat on monetary policy this week, against the backdrop of a possible Brexit from the EU.
Oil prices continued to slip, with Brent crude last down 0.96% at $50.06 and West Texas Intermediate losing 1.07% at $48.55 per barrel.
On the corporate front, Sales chief at BMW Ian Robertson told Automobilwoche that the company sees the US market as at best stagnating in 2016, adding “we are working to markedly cut inventories at our dealers” - its shares were last down 1.77%.
Securities giant BNP Paribas was down 0.94% after it said it expects to grow fiduciary services in Brazil by replacing its foreign rivals as they exit the shaky Latin American economy, according to two senior executives.
Deutsche Bank had last lost 1.92%, with a Frankfurt court expected to rule on carousel trade in emission certificates, with two Deutsche Bank employees accused of evading taxes when buying and selling certificates.
Low-cost carrier easyJet told the Sunday Telegraph is has explored setting up a separate European business if Britain leaves the European Union - it was down 0.14% in early trading.
Eni was no longer riding the wave of its Goliat offshore production facilities in Norway, after announcing on Friday that they were currently producing around 80,000 barrels of oil per day, and will soon reach peak production of 100,000 bpd - its shares lost 1.16% in early trading.
Julius Baer was off 1.06% after chief executive Boris Collardi told Swiss newspaper Schweiz am Sonntag that the company will focus on organic growth this year, as well as Asia, and he is confident it will reach new money growth targets of 4-6%.
The world’s largest cement maker LafargeHolcim lost 1.98% after it said it has identified another nine countries where it will make divestments it it can achieve favourable valuations, though it did not name the locations.
Its board has said it is on track to hit a CHF 3.5bn asset sale goal this year with disposals in Saudi Arabia, South Korea and India so far.
French drugmaker Sanofi was down 0.37% after it announced that two pivotal phase III clinical trials of its LixiLan diabetes drug have met targets, sending it towards US approval in August and Europe early next year.
Italy’s biggest bank UniCredit lost 1.18% after its adviser Egon Zehnder has drawn a tentative list of CEOs, according to Corriere della Sera, though that paper appeared to throw its rhetoric behind UBI Banca CEO Victor Massiah.