Log in
Forgot password ?
Become a member for free
Sign up
Sign up
Dynamic quotes 

4-Traders Homepage  >  News  >  Commodities

News : Commodities

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance ProfessionalsCalendarSectors 

EUROPE MARKETS: European Stocks Drop As Worries About Growth, 'Brexit' Weigh

share with twitter share with LinkedIn share with facebook
share via e-mail
06/16/2016 | 06:13pm CEST

By Carla Mozee, MarketWatch

Stoxx 600 posts 6th loss in 7 sessions

European stocks dropped Thursday, posting their sixth loss in seven sessions, with investors gripped by concerns about slowing economic growth ahead of next week's U.K. vote on whether to leave the European Union.

The Stoxx Europe 600 fell 0.7% to close at 321.29, after paring losses in the afternoon.

European equities were rattled Thursday after the U.S. Federal Reserve trimmed its 2016 forecast for growth in the world's largest economy to 2% from 2.2%, and as the central bank indicated it would take an even slower approach to raising interest rates (http://www.marketwatch.com/story/fed-holds-rates-steady-as-more-officials-move-into-one-hike-camp-2016-06-15).

"Usually, traders will push the equity markets higher if the Fed is going to stay on the dovish side, but today is not that day," said Naeem Aslam, chief market analyst at Think Forex UK, in a note. "[T]hey are questioning the Fed's strategy. Lowering growth forecasts even if it is only by a notch is not a good beat."

Fed Chairwoman Janet Yellen said the U.K.'s June 23 referendum on whether the country will stay in the EU was a factor in its decision to leave interest rates steady. Two fresh opinion polls (http://www.marketwatch.com/story/brexit-fears-escalate-as-key-polls-show-lead-for-leave-voters-2016-06-16)released Thursday added to recent surveys showing the British public is leaning toward supporting a so-called Brexit.


Ipsos Mori showed a 6-point swing from "remain" to "leave," while an IG/Survation poll showed the "leave" camp ahead of "remain" supporters, 45% to 42%. The British pound fell to $1.4068, around the lowest it's been since April. The U.K's FTSE 100 fell 0.3% to 5,950.48 (http://www.marketwatch.com/story/ftse-100-sags-as-investors-hunt-for-safety-ahead-of-brexit-vote-2016-06-16).

The Bank of England, as expected, on Thursday left its benchmark interest rate at 0.5% (http://www.marketwatch.com/story/bank-of-england-holds-key-rate-at-05-ahead-of-brexit-referendum-2016-06-16).

Safety plays: As equities sold off, haven assets gained. Gold futures traded above $1,300 an ounce, the Japanese yen drove higher, and government bond yields fell as prices advanced. For the first time ever, the yield on Switzerland's 30-year bond turned negative.

The yield on the 10-year German bund was down 2 basis point at minus 0.024%, according to Tradeweb. The yield this week fell into negative territory for the first time.

Banks bruised: The Swiss financial sector was hit, with Credit Suisse Group AG (>> Credit Suisse Group AG) down 1.4% and UBS Group AG off 0.4%.

The Swiss National Bank said those lenders will need about 10 billion Swiss francs ($10.42 billion) in new capital to meet Switzerland's new capital requirements. The SNB made the statement in its 2016 financial stability report Thursday.

Other bank stocks were also in the red, hurt by low bond yields and the prospect of a Brexit. Banco Comercial Português SA (BPCGY) dropped 6.3%, Commerzbank AG (>> Commerzbank AG) gave up 2.3%, and Banca Monte dei Paschi di Siena SpA (>> Banca Monte dei Paschi di Siena SpA) fell 3.4%.

Economic docket: As expected, the Swiss National Bank kept interest rates steady (http://www.marketwatch.com/story/swiss-national-bank-keeps-interest-rates-steady-2016-06-16), holding its deposit rate at negative 0.75%.

The Bank of Japan also stood pat on monetary policy (http://www.marketwatch.com/story/brexit-fears-lead-bank-of-japan-to-leave-rates-unchanged-2016-06-15)on Thursday, as expected. The Nikkei Stock Average slumped 3.1% after the announcement and a press conference by BOJ Governor Haruhiko Kuroda.

Indexes: Germany's DAX 30 lost 0.6% to 9,550.47 and Switzerland's SMI fell 0.6% to 7,634.66.

France's CAC 40 lost 0.5% to 4,153.01. Italy's FTSE MIB gave up 1% at 16,351.90. Spain's IBEX 35 fell 0.6% to 8,199.90.

The euro bought $1.1156, down from $1.1265 late Wednesday.

share with twitter share with LinkedIn share with facebook
share via e-mail
Latest news "Commodities"
03:48a Noble Group to sell oil liquids business to Vitol, flags big third quarter loss
03:47a NOBLE : to sell oil liquids business to Vitol, flags big third quarter loss
03:42a Oil prices rise on tightening supply, strong demand
02:42a NO FUTURE(S) : Asian financial coal trading dries up as Noble declines, Glencore rules
10/21 Iraqi foreign minister to discuss Kurdistan, oil projects in Moscow
10/21 Saudi oil minister makes high profile Iraq visit, calls for economic cooperation
10/21 Saudi Arabia says oil market improving as exporters fully comply with cutbacks
10/21DJBig Oil Set for Bumper Profits Despite Cheap Crude
10/21 Saudi Oil Minister Falih arrives in Baghdad, Sumariya TV says
10/20DJCotton Breaks Lower as Bulls Lose Hope
Latest news "Commodities"