Telecoms drag European stocks lower
European stocks were lower Friday morning, with the prospect of further hikes in U.S. borrowing costs prompting investors to rush out of crowded trades.
The pan-European Stoxx 600 was down around 0.3 percent during early morning deals, with most sectors and major bourses in negative territory.
Europe’s telecoms sector led the losses shortly after the opening bell, down more than 1 percent Friday morning. Vodafone, Telia Company and Telenor were the worst sectoral performers, falling almost 2 percent.
Looking at individual stocks, Delivery Hero surged to the top of the European benchmark during early morning deals. It comes after Netherlands-based Takeaway.com announced it would buy the German unit of the world’s biggest online delivery firm for around 930 million euros ($1.07 billion). Shares of Delivery Hero jumped almost 20 percent Friday morning, with Britain’s Just Eat also rising 5 percent on the news.
Meanwhile, Danske Bank tumbled to the bottom of the index after the major Danish lender issued a profit warning. The Copenhagen-listed company cut its full-year 2018 net profit outlook by approximately 2 billion Danish crowns ($307 million). Shares fell 3 percent.
Fragile market sentiment
Market sentiment soured overnight, after the Federal Reserve largely retained plans to increase interest rates next year despite escalating risks to economic growth.
The U.S. central bank raised its benchmark interest rate by a quarter-point on Wednesday, marking the fourth increase this year and the ninth since it began normalizing in December 2015.
The fragile mood in financial markets intensified as President Donald Trump refused to sign legislation to fund the U.S. government on Thursday, raising the risk of a federal shutdown over the weekend.
In Asia, MSCI’s broadest index of Asia-Pacific shares, excluding Japan, slipped 0.5 percent on Friday.
Back in Europe, investors are likely to monitor Italian business and consumer confidence figures for December at around 9:00 a.m. London time.
In oil markets, crude futures fell another 5 percent in the previous session, bringing Brent’s losses since its October peak to around 37 percent.
The international benchmark was trading at around $54.78 Friday morning, up around 0.8 percent, while U.S. West Texas Intermediate (WTI) stood at $46.27, almost 0.9 percent higher.
Source: CNBC
