EUROPE MARKETS: European Stocks Finish Lower As Trump Rally Falters
March 27 2017 - 12:28PM
Dow Jones News
By Sara Sjolin and Victor Reklaitis, MarketWatch
Euro rises after doubts over Trump's agenda build
European stocks finished in the red Monday, alongside a slide
for global equities, as investors continued to worry the Trump
administration will not be able to push through its reforms.
The Stoxx Europe 600 index lost 0.4% to end at 375.01, though it
finished above its session lows.
On Friday, the pan-European benchmark dropped 0.2% to end 0.5%
lower for the week, as it became clear U.S. President Donald Trump
was running into difficulties getting approval for his repeal of
Obamacare. That sparked concerns Trump will struggle to follow
through on other election promises, such as corporate tax cuts, the
prospect of which has helped drive a recent rally in stocks
world-wide. Republican leaders ended up pulling their health-care
bill from a House of Representatives vote late Friday, and analysts
said that helped spark selling in global stocks on Monday.
Read:Debt limit looks like a real struggle after health bill
debacle
(http://www.marketwatch.com/story/debt-limit-looks-like-a-real-struggle-after-ahca-debacle-2017-03-24)
And see:'Trump disappointment trade is now in full swing' --
analysts on global stock selloff
(http://www.marketwatch.com/story/trump-disappointment-trade-is-now-in-full-swing-analysts-on-global-stock-selloff-2017-03-27)
"Equity valuations have been underpinned by the Trump reflation
trade since November, but the failure of the health-care bill
raises major doubts about the strength of the administration and
risks unwinding all the gains that the market has seen over the
past five months," said Rebecca O'Keeffe, head of investment at
stockbroker Interactive Investor, in a note.
Read:These 5 charts show how Trump's health-care flop is hitting
markets
(http://www.marketwatch.com/story/these-5-charts-show-how-trumps-health-care-flop-is-hitting-markets-2017-03-27)
Sectors bruised: Banks, which have particularly benefited from
the reflation trade, were among the notable decliners in Europe on
Monday.
Shares of Lloyds Banking Group PLC (LLOY.LN) (LLOY.LN) dropped
1.6%, UBS Group AG (UBS) fell 0.6%, Deutsche Bank AG (DBK.XE)
(DBK.XE) lost 0.2%, and Société Générale (GLE.FR) gave up 0.4%.
The risk-off trade also hit miners and oil companies, with
shares of metals giant Glencore PLC (GLEN.LN) down 4.4% and energy
heavyweight Royal Dutch Shell PLC (RDSB.LN)(RDSB.LN) off 0.3%.
Oil prices recently traded down by about 0.6%, as concerns over
rising U.S. rig counts
(http://www.marketwatch.com/story/oil-prices-fall-as-worries-over-global-supply-resurface-2017-03-27)outweighed
chatter that the Organization of the Petroleum Exporting Countries
may extend its production cuts.
Read: OPEC urges members to uphold oil production cuts
(http://www.marketwatch.com/story/opec-urges-members-to-uphold-oil-production-cuts-2017-03-26)
Individual indexes: The commodity- and bank-heavy FTSE 100 fell
0.6% to end at 7,293.50 in London
(http://www.marketwatch.com/story/ftse-100-falls-to-1-month-low-as-fading-trump-trade-hits-banks-2017-03-27),
suffering its lowest close in almost a month.
Germany's DAX 30 index gave up 0.6% to finish at 11,996.07,
while France's CAC 40 index lost 0.1% to 5,017.43.
Economic news: Business sentiment in Germany has improved in
March, as the Ifo business climate index rose to 112.3 points, up
from 111.1 in February. Economists had expected a reading of 111.1
for March.
Separately, European Central Bank board member Sabine
Lautenschläger said the bank should prepare to tighten policy as
soon as economic data are stable
(http://www.marketwatch.com/story/ecb-should-get-ready-to-tighten-policy-lautenschlager-says-2017-03-27).
The euro traded at $1.0883
(http://www.marketwatch.com/story/dollar-hits-lowest-level-against-yen-since-late-november-2017-03-27),
compared with $1.0800 late Friday in New York, as the dollar lost
ground
(http://www.marketwatch.com/story/dollar-hits-lowest-level-against-yen-since-late-november-2017-03-27)
against major currencies.
(END) Dow Jones Newswires
March 27, 2017 12:13 ET (16:13 GMT)
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