This post was originally published on this site
European stocks were lower Tuesday amid political uncertainty in Italy and an unresolved trade dispute between the U.S. and China.
The pan-European Stoxx 600 was down almost 0.6 percent, with the majority of sectors and major bourses in negative territory.
Europe’s banking index was among the worst sectoral performers, down 1 percent after a prominent Italian lawmaker said Rome would enjoy more favorable economic conditions outside the euro zone. Italy’s FTSE MIB tanked earlier in the session but pared those losses slightly later on in the day.
Claudio Borghi, a euroskeptic economist who chairs the budget committee of the lower house of Italy’s parliament, said in a radio interview Tuesday that he was “truly convinced” most of the country’s problems would be solved if it had its own currency.
Borghi’s comments were quickly contradicted by Italy’s deputy prime minister, Luigi Di Maio, who said said Italy’s coalition government did not want to leave the European Union or the single currency. Italian Prime Minister Giuseppe Conte also rebuffed the comments, saying the euro was “unrenounceable” for the country. Nonetheless, several of Italy’s banks were trading lower on the news, with Unicredit, Ubi Banca and Banco Bpm all down almost 2 percent.
Looking at individual stocks, Britain’s Royal Mail slumped to the bottom of the European benchmark after the postal service company issued a profit warning on Monday. Shares of Royal Mail plummeted 9 percent on the news.
At the other end, Wienerberger climbed to the top of the continental benchmark after the firm issued upbeat earnings guidance, saying it foresaw an accelerated pace of growth and increased its medium-term targets. Shares of the firm were up nearly 5 percent.
And shares of Ubisoft surged after Google announced Monday it planned to test a game-streaming service alongside the company. The stock was up 2.7 percent.
On Wall Street, stocks fell slightly as technology and bank shares declined. The Dow slipped 19 points, while the S&P 500 and Nasdaq Composite both slipped 0.1 percent.
Investors continue to closely watch global trade developments, after the U.S. and Canada forged a last-gasp deal on Sunday to revamp NAFTA as a trilateral pact with Mexico. The accord rescued a $1.2 trillion open-trade zone that had been about to collapse after almost quarter of a century.
But attention has swiftly turned once again to China, which is still engaged in a trade war with the U.S. Ratings agencies Fitch and Moody’s on Tuesday warned of the ongoing threat of the trade dispute between the world’s two largest economies. Fitch said it posed downside risks to 2019 growth projections while Moody’s said U.S.-Sino trade tensions will escalate.
Meanwhile, over in Britain, a hotly anticipated speech by former U.K. Foreign Secretary Boris Johnson was met with applause at the reigning Conservative Party’s annual conference, and was interpreted by observers as a potential leadership challenge to Prime Minister Theresa May. Johnson said in his speech that the country ought to “chuck” May’s so-called Chequers plan, which he said was “politically humiliating.” Sterling faltered against the dollar on Thursday, trading 0.5 percent lower at $1.2973.