European stocks extend losses

 

European stock markets fell Monday, extending pre-weekend losses, as major takeover activity within the oil and car sectors failing to lift overall sentiment.

European markets opened shortly after French oil giant Total (LSE: 524773.L - news) said it would buy Maersk Oil, a unit of the Danish shipping giant A.P. Moller-Maersk, for $7.45 billion (6.35 billion euros).

Traders in Europe reacted also to news that Tokyo's benchmark stock index fell to the lowest level in almost four months, hit by lingering concerns about US President Donald Trump's stalled economic agenda.

Such worries had hurt global stocks on Friday, with valuations pressured further by the terror attacks in Barcelona as investors sought haven investments such as the yen and gold.

"As the past two weeks have shown, we are in for an unpredictable period for stock markets," said Joshua Mahony, market analyst at IG (Frankfurt: A0EARV - news) trading group.

"Donald Trump's unstable presidency has been the biggest driver of volatility of late."

Away from US economic concerns, Total shares fell 0.6 percent to 42.38 euros, while in Copenhagen, A.P. Moller-Maersk won 4.0 percent.

Total said the deal would make it the second-largest operator in the North Sea, with substantial operations in Britain, Norway and Denmark.

Elsewhere Monday, China's Great Wall Motor (Shanghai: 601633.SS - news) signalled an intention to make an ambitious offer to buy all or part of Italian-American car maker Fiat Chrysler Automobiles.

FCA shares jumped 3.3 percent to 11.05 euros in Milan.

Asian traders meanwhile moved cautiously Monday with turmoil in the White House fuelling concerns about Trump's economic agenda, as a central bankers' summit comes into view later in the week.

While tensions over North Korea have eased, the deadly terror attack in Barcelona on Thursday is keeping focus on geopolitical issues.

US dealers Friday provided a negative lead, with all three main New York indices ending in the red.

There are fears that Trump's promises of tax reform and other pro-business measures will not see the light of day, with his support from corporate America damaged by his much-criticised response to a white supremacist rally in Virginia over a week ago.

Hopes that his tax and spending plans would fire the world's top economy had helped stoke a rally in global markets and the dollar at the start of the year but that has foundered in recent months.

The White House turmoil continued Friday after Trump's top adviser Steve Bannon was dismissed -- marking the fifth inner circle casualty in just six months -- while there has been talk too that his economic adviser Gary Cohn would step down.

Tokyo stocks ended 0.4-percent down Monday as exporters were hurt by a stronger yen, while Hong Kong was up 0.5 percent and Shanghai added 0.6 percent.

Sydney eased 0.4 percent and Seoul was 0.1 percent off. Wellington was slightly lower while Singapore was flat.

"Geopolitical risk could rear its ugly head again this week as the US and South Korea begin planned military exercises on Monday, just as tensions between the North and these two countries appear to have calmed," said Oanda senior market analyst Craig Erlam.

"Should North Korea respond in kind, then we could see a repeat of the safe haven rush."

- Key figures around 0930 GMT -

London - FTSE 100: DOWN 0.2 percent at 7,310.02 points

Frankfurt - DAX 30: DOWN 0.4 percent at 12,111.39

Paris - CAC 40: DOWN 0.5 percent at 5,090.67

EURO STOXX 50: DOWN 0.4 percent at 3,431.11

Tokyo - Nikkei 225: DOWN 0.4 percent at 19,393.13 (close)

Hong Kong - Hang Seng: UP 0.4 percent at 27,154.68 (close)

Shanghai - Composite: UP 0.6 percent at 3,286.91 (close)

New York - Dow: DOWN 0.35 percent to 21,674.51 (close)

Euro/dollar: DOWN at $1.1739 from $1.1762 at 2100 GMT

Pound/dollar: DOWN at $1.2871 from $1.2885

Dollar/yen: DOWN at 109.07 yen from 109.22 yen

Oil - Brent North Sea: DOWN 17 cents at $52.55 per barrel

Oil - West Texas Intermediate: UP five cents at $48.56

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