Related Articles
* UK ramps up no-deal preparations as EU trade talks stall
* German exports rise in July but remain below pre-crisis
levels
* Technology leads sectoral declines, defensives rise
* French electricity giant EDF sinks as output falls
Sept 8 (Reuters) – European shares fell on Tuesday on fears
that the UK was in danger of leaving the European Union without
a trade agreement, while technology firms tumbled as their U.S.
peers looked set to deepen a selloff from last week.
The pan-European STOXX 600 fell 0.4%, shortly after opening
marginally higher, as technology stocks weighed the most
with a 1.7% fall.
The focus now shifts to Wall Street returning from a long
weekend, following news that Softbank made big option
purchases during the run-up in the U.S. stock market, with the
trades being revealed just as a tech-led rally faltered.
“(Wall Street) did stabilise and recover soon after the
Friday open but this will be the first full trading session
where specific news of the recent fevered options market
activity has been fully revealed to the market. So it’s a big
session today,” said Jim Reid, strategist at Deutsche Bank.
Futures tracking the Nasdaq 100 index fell 1.3% in
early trading.
Adding to the downbeat tone, Britain began a fresh round of
Brexit trade talks this week by warning the European Union that
it was ramping up preparations to leave the bloc without an
agreement as the two sides bicker over rules that govern nearly
$1 trillion in trade.
Analysts at Commerzbank urged caution against completely
excluding a scenario where negotiations fail.
“This is the result of the typical prisoner’s dilemma: for
fear of getting short shrift, an agreement is then reached that
is disadvantageous for both sides but the ‘devil may care’
approach demonstrated by the British government does not exactly
help to instil confidence.”
Frankfurt shares fell the least among peers after
data showed German exports rose in July but remained far below
their pre-crisis level.
Defensive sector indexes, including real estate as
well as food and beverages, were among the few making
gains in early trading.
French electricity giant EDF sank 6.5% after
announcing its nuclear output fell 17.6% in August due to the
effects of the pandemic and reactor outages.
Britain’s Royal Mail jumped 15% after raising its
revenue target for the current year.
The European Central Bank’s (ECB) policy decision is on the
roster for Thursday, with the bank expected to keep its policy
stance unchanged. Investors will focus on the ECB’s inflation
forecasts and whether it seems concerned by the euro’s recent
strength.
Markets also await second-quarter GDP data for the euro zone
later in the day, with economists polled by Reuters expecting a
12.1% quarter-over-quarter decline.
(Reporting by Shreyashi Sanyal in Bengaluru; editing by Patrick
Graham and Devika Syamnath)
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