European shares tumble amid trade tensions

  • Reuters
  • Stock Market News
European shares tumble amid trade tensions
Credit: © Reuters.

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May 9 (Reuters) - European shares dropped broadly on Thursday as investors shunned risky assets while waiting to see whether United States and China manage to avoid a trade war which would damage the global economy.

The pan-European STOXX 600 index .STOXX had dropped 0.7 percent by 0720 GMT, touching a fresh four-week low.

U.S. President Donald Trump said on Wednesday that China "broke the deal" it had reached in trade talks with the United States, and vowed not to back down on imposing new tariffs on Chinese imports.

As the world's largest economies resume two-day trade talks on Thursday in Washington, investors were on the edge to see if a last minute truce could avert a sharp increase of tariffs on $200 billion worth of Chinese goods on Friday. than seven major sectors lost above 1 percent. Tariff-exposed auto stocks .SXAP slid 1.6 percent decline while semiconductor stocks also lost ground.

Adding to chipmaker's woes was Intel Corp's INTC.O uninspiring full year outlook. in heavyweight bank stocks .SX7P weighed the most, with results from some of the biggest Italian banks in focus.

Italy's third largest lender, Banco BPM BAMI.MI dropped nearly 6 percent after reporting a halving of loan-loss provisions for the first quarter. the country's biggest bank by assets UniCredit CRDI.MI dipped even after it reiterated its 2019 targets and posted a net profit above analyst expectations. the biggest decliners were shares of ArcelorMittal MT.AS after the world's largest steelmaker cut demand forecast for its key markets and said it was facing the twin challenges of lower steel prices and reduced consumption in Europe. wholesaler Metro B4B.DE slid after reporting another quarter of falling sales at its Russian business and its Real hypermarkets, which the company is in the process of selling. drugmaker Novartis NOVN.S dipped on a deal to buy Takeda Pharmaceutical's 4502.T eye drug assets for $3.4 billion. of Norway's Equinor EQNR.OL came under pressure after wage talks between Norwegian oil firms and their employees broke down. sought safety in defensive stocks such as telecom .SXKP , utilities .SX6P and real estate .SX86P which eked out the smallest losses.

Germany's Rheinmetall RHMG.DE was the top percentage gainer on the STOXX 600 after it confirmed its outlook and reported a rise in revenue in the first quarter, mainly driven by its booming defense unit.

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