LONDON: European equities dropped to a two-week low on Monday, recording their fifth straight daily decline, as fears for China’s growth prospects overshadowed some forecast-beating results.
A slightly better-than-expected July reading from the German IFO business climate index helped ease some of the sell-off pressure in early trading. But shares fell further following a weaker start on Wall Street on concerns that China’s growth prospects were dimming, after Shanghai stocks suffered their biggest one-day loss in eight years.
The FTSEurofirst 300 index ended 2.2 percent lower at 1,529.77 points after falling to 1,529.03, the lowest level in two weeks. It has fallen more than 5 percent in a week, but is still up 12 percent this year.
Sectors exposed to China – the world’s biggest metals consumer and a big market for automobiles, luxury goods, oils and industrial goods – were the worst hit. The European autos , basic resources, energy and industrial goods sectors fell between 1.3 and 2.8 percent.
“Investor sentiment is deteriorating because of signs of a slowdown in China. Other signals like German car exports to the country and China’s electricity output are also disappointing,” UniCredit strategist Christian Stocker said.
