Investing.com - European shares closed sharply lower Monday on global growth concerns and political uncertainty.
At the close of European trade, the EURO STOXX 50 gave back 2.87%, France's CAC 40 plunged 2.83%, while Germany’s DAX spiraled down 3.36%. Meanwhile, in the U.K. the FTSE 100 dropped 1.85%.
Equities suffered from the risk-off trade, amid ongoing political uncertainty after Dutch Prime Minister Mark Rutte’s government was forced to resign after negotiations on its austerity budget for 2013 broke down.
In addition, French borrowing costs increased Monday, after President Nicolas Sarkozy poor performance against challenger Francois Hollande in the first round of the country’s presidential election.
Hollande stated he wants to renegotiate the euro zone’s fiscal pact in order to stimulate growth in the bloc, rather than enforcing strict austerity measures.
Meanwhile, worries over the economic outlook mounted after data showed that the euro zone's manufacturing output slumped to its lowest level since June 2009 this month, while its services sector fell to a five month low.
The decline was driven by poor performances in Germany and France, with manufacturing activity in Germany slowing to the lowest level in almost three years.
The weak data fuelled fears economic growth in the region will be hit by planned government austerity measures.
In other euro zone bearish news Monday, the Bank of Spain reported it believes that the country’s economy has entered a recession.
The central bank said gross domestic product contracted by 0.4% in the three months to March. That follows a 0.3% contraction in the fourth quarter, and zero growth in the third quarter of last year.
An index signaled that Chinese manufacturing may shrink for the sixth straight month in April fostering fears of a continuing global economic slowdown.
Automobile makers led the rout with Daimler dropping 4.2% and BMW giving back 4.1%.
ING, the largest Dutch financial company, plunged 6.1% on falling Dutch bonds.
Deutsche Bank fell 4.4% as Germany’s largest lender may suffer an additional charge related to the sale of Actavis Group.
U.S. stocks are following lower with the Dow plunging 1.01%, the S&P 500 giving back 1.02% and the Nasdaq falling 1.17%.
Investors are awaiting U.S. consumer confidence, new home sales, Canadian core retail sales as well as a speech by Canadian central bank president Carney on Tuesday.
At the close of European trade, the EURO STOXX 50 gave back 2.87%, France's CAC 40 plunged 2.83%, while Germany’s DAX spiraled down 3.36%. Meanwhile, in the U.K. the FTSE 100 dropped 1.85%.
Equities suffered from the risk-off trade, amid ongoing political uncertainty after Dutch Prime Minister Mark Rutte’s government was forced to resign after negotiations on its austerity budget for 2013 broke down.
In addition, French borrowing costs increased Monday, after President Nicolas Sarkozy poor performance against challenger Francois Hollande in the first round of the country’s presidential election.
Hollande stated he wants to renegotiate the euro zone’s fiscal pact in order to stimulate growth in the bloc, rather than enforcing strict austerity measures.
Meanwhile, worries over the economic outlook mounted after data showed that the euro zone's manufacturing output slumped to its lowest level since June 2009 this month, while its services sector fell to a five month low.
The decline was driven by poor performances in Germany and France, with manufacturing activity in Germany slowing to the lowest level in almost three years.
The weak data fuelled fears economic growth in the region will be hit by planned government austerity measures.
In other euro zone bearish news Monday, the Bank of Spain reported it believes that the country’s economy has entered a recession.
The central bank said gross domestic product contracted by 0.4% in the three months to March. That follows a 0.3% contraction in the fourth quarter, and zero growth in the third quarter of last year.
An index signaled that Chinese manufacturing may shrink for the sixth straight month in April fostering fears of a continuing global economic slowdown.
Automobile makers led the rout with Daimler dropping 4.2% and BMW giving back 4.1%.
ING, the largest Dutch financial company, plunged 6.1% on falling Dutch bonds.
Deutsche Bank fell 4.4% as Germany’s largest lender may suffer an additional charge related to the sale of Actavis Group.
U.S. stocks are following lower with the Dow plunging 1.01%, the S&P 500 giving back 1.02% and the Nasdaq falling 1.17%.
Investors are awaiting U.S. consumer confidence, new home sales, Canadian core retail sales as well as a speech by Canadian central bank president Carney on Tuesday.