European shares extended last week’s losses on Monday as investors fretted over oil price volatility, slowing global growth and uncertainty over the Federal Reserve’s monetary policy.
Stocks were falling across the board after results of a survey by Sentix revealed that Eurozone investor sentiment weakened for the second straight month to the lowest since early 2015, Nasdaq reported.
The investor sentiment index dropped more than expected to 6 in February from 9.6 in January. Economists forecast the index to ease to 8.8.
The pan-European Stoxx 600 was down 2.5%, heading for a sixth day of losses. The German DAX, France’s CAC 40 and the UK’s FTSE 100 were declining 2-3%.
Commodity-related stocks like BHP Billiton, Royal Dutch Shell, Anglo American and Antofagasta fell 1-2% in London.
Insurer Old Mutual lost 1.8% after announcing sale of Rogge Global Partners to Allianz Global Investors.
Franco-Dutch airline Air France KLM declined 2% in Paris after reporting passenger traffic figures for January.
Shares of Orange, formerly France Telecom, shed more than 2% after Nasdaq-listed Millicom International Cellular has announced an agreement for the sale of its Tigo business in the Democratic Republic of Congo to France’s biggest telecoms firm.
German banks Commerzbank and Deutsche Bank fell about 5% each in Frankfurt while automakers BMW, Daimler and Volkswagen dropped 3-4%.
Asian Shares Defy
Asian shares closed flat to higher on Monday even as many markets across the region, including China, Hong Kong, Indonesia, South Korea, Malaysia, the Philippines, Singapore and Taiwan, remained closed for the Lunar New Year holidays. The New Zealand market was closed in observance of Waitangi Day. Markets in mainland China and Taiwan are closed all week while Hong Kong markets are closed until Wednesday.
Japanese shares snapped a four-day losing streak after the dollar rose above 117 yen and data showed Japan posted an 18th consecutive current account surplus, boosted by a plunge in crude oil imports and a record travel surplus. The dollar rose to 117.39 yen from 116.82 yen as investors looked ahead to Fed Chair Janet Yellen’s semi-annual testimony to Congress this week for further clues on rate hike prospects.
The Nikkei average hit a two-week low of 16,552.30 in early trade before rebounding to close 184.71 points or 1.10% higher at 17,004.30. The broader Topix index added 0.8% to finish at 1,380.41. Australian shares closed marginally lower despite steep losses on Wall Street Friday. The benchmark S&P/ASX 200 dropped as much as 0.9% in early trade before recouping losses to end the session down 0.80 points or 0.02% at 4,975.40. The broader All Ordinaries index slipped 3.50 points or 0.07% to end at 5,022.10.
