Last Update 21:29
Thursday, 14 November 2019

European stock market sell-off gathers pace, Glencore halts slide

Reuters , Tuesday 29 Sep 2015
Share/Bookmark
Views: 685
Share/Bookmark
Views: 685

European shares fell for the second day in a row on Tuesday, with health stocks hit by a drop in their U.S. counterparts, although battered miner Glencore halted a slide in its share price.

German carmaker Volkswagen, which has been hit by an emissions data scandal, also remained under pressure with its shares falling by nearly 2 percent.

The pan-European FTSEurofirst 300 index and the euro zone's blue-chip Euro STOXX 50 index both fell by around 1 percent, following on from losses of more than 2 percent on both indexes on Monday.

The STOXX Europe 600 Health Care index was among the worst-performing equity sectors, weakening by 2.1 percent after U.S. pharmaceutical and biotech stocks fell overnight.

The U.S. biotech sector was hit after U.S. Democratic lawmakers on Monday attacked "massive" price increases of two heart drugs from Valeant Pharmaceuticals.

In Europe, British healthcare group Shire was down by 3.6 percent while Switzerland's BB Biotech retreated 2.8 percent.

"The momentum is to the downside for those biotech stocks," said Terry Torrison, managing director at Monaco-based McLaren Securities. "These are still very nervous markets, and I think that any rebound should be sold into."

BROKERS TALK UP GLENCORE

Shares in Volkswagen also fell, with Hungary's Economy Minister Mihaly Varga saying on Tuesday that about 2 million of the 11 million diesel engines involved in the Volkswagen emissions scandal were manufactured at an Audi plant in western Hungary.

The plight of Volkswagen partly led brokerage Kepler Cheuvreux to cut its rating on the German stock market to "underweight" from "neutral".

Germany's DAX hit a record high of 12,390.75 points in April but has since lost ground and is now some 24 percent below those levels.

The DAX and other world stock markets have lost ground in the last few months partly due to signs of a slowdown in China, which has also hit the commodity sector since China is a major consumer of metals and oil.

The prolonged fall in metals prices has been one of the reasons behind Glencore's stock market slump. It fell nearly 30 percent on Monday but recovered slightly to rise by 7 percent on Tuesday.

Analysts at U.S. bank Citigroup said Glencore should even consider going private via a management buyout if the market rout continued, and Citi kept a "buy" rating on Glencore shares.

Short link:

 

Email
 
Name
 
Comment's
Title
 
Comment
Ahram Online welcomes readers' comments on all issues covered by the site, along with any criticisms and/or corrections. Readers are asked to limit their feedback to a maximum of 1000 characters (roughly 200 words). All comments/criticisms will, however, be subject to the following code
  • We will not publish comments which contain rude or abusive language, libelous statements, slander and personal attacks against any person/s.
  • We will not publish comments which contain racist remarks or any kind of racial or religious incitement against any group of people, in Egypt or outside it.
  • We welcome criticism of our reports and articles but we will not publish personal attacks, slander or fabrications directed against our reporters and contributing writers.
  • We reserve the right to correct, when at all possible, obvious errors in spelling and grammar. However, due to time and staffing constraints such corrections will not be made across the board or on a regular basis.
Latest

© 2010 Ahram Online.