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European stocks turn sharply lower on weak GDP data; Dax down 1.10%

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Investing.com - European stocks turned sharply lower on Thursday, after the release of weak economic growth data from the euro zone sparked fresh concerns over the worsening of the bloc's financial crisis.

During European afternoon trade, the EURO STOXX 50 retreated 0.98%, France's CAC 40 declined 0.83%, while Germany's DAX 30 tumbled 1.10%.

Stocks were hit after Eurostat said euro zone gross domestic product contracted by 0.6% in the three months to December, compared to expectations for a 0.4% decline, after a 0.1% contraction in the third quarter.

Euro zone GDP fell 0.9% compared to a year earlier, worse than expectations for a 0.7% contraction, after shrinking at an annualized rate of 0.6% in the previous quarter.

Earlier in the day, official data showed larger-than-forecast contractions in German, French and Italian fourth quarter economic growth.

Financial stocks remained broadly lower, as German lenders Deutsche Bank and Commerzbank tumbled 1.71% and 2.67%, while France's Societe Generale plunged 3.21%.

BNP Paribas overperformed on the other hand, surging 2.77%, after increasing its dividend.

Peripheral lenders also trended sharply lower, with Italian banks Unicredit and Intesa Sanpaolo retreating 0.87% and 1.92%, while Spain's Banco Santander and BBVA plummeted 2.15% and 2.98% respectively.

Elsewhere, Nokia saw shares dive 3.64% amid reports the cellphone company may be planning to join Apple in reducing its dependance on Korea's Samsung as a component supplier.

In London, FTSE 100 dropped 0.73%, as U.K. lenders tracked their European counterparts lower.

Shares in HSBC Holdings declined 0.61% and Lloyds Banking retreated 0.63%, while the Royal Bank of Scotland and Barclays tumbled 1.19% and 1.98%.

Meanwhile, mining stocks turned mostly lower, as Rio Tinto plummeted 1.21%, while copper producers Xstrata and Kazakhmys fell 0.19% and 2.09% respectively.

Earlier in the day, Rio Tinto posted a loss for 2012, and new CEO Sam Walsh vowed to slash costs and invest capital more carefully in 2013.

Reckitt Benckiser continued to trend higher however, advancing 0.86%, after the consumer goods company behind Lemsip, Nurofen and Strepsils throat lozenges said fourth-quarter sales increased by 6%, taking annual sales up to GBP9.6 billion.

In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.44% drop, S&P 500 futures signaled a 0.37% decline, while the Nasdaq 100 futures indicated a 0.39% loss.

Later in the day, the U.S. was to release the weekly government report on initial jobless claims.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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