European Stocks on the Decline
European stocks are on the decline this week, with the Stoxx Europe 600 Index set to post its worst weekly loss in a month. The index was down 0.6% on Friday, with the losses spread across sectors.
Falling Shares of WPP
Shares of WPP, the world’s largest advertising company, fell 3.2% on Friday. The company reported a drop in first-half revenue and said it was cutting its dividend. WPP also said it was cutting its full-year revenue forecast.
Retailers and Banks Among Losers
Retailers and banks were among the biggest losers on Friday. Shares of Carrefour SA, Europe’s largest retailer, fell 2.3%. Shares of Deutsche Bank AG, Germany’s largest lender, dropped 1.7%.
Oil and Gas Companies Among Gainers
Oil and gas companies were among the biggest gainers on Friday. Shares of Royal Dutch Shell Plc rose 1.3%, while shares of BP Plc rose 0.9%.
Growth Concerns Weigh on Markets
The decline in European stocks comes as investors worry about the outlook for economic growth. The European Central Bank has warned that the region’s economy is facing a “protracted period of weak growth” and that it could take years for the region to recover from the pandemic.
The ECB has also said that it is ready to take further action to support the economy if needed. The bank has already cut interest rates to record lows and launched a massive bond-buying program.
Brexit Negotiations Adding to Uncertainty
The ongoing Brexit negotiations are also adding to the uncertainty. The UK and the EU have yet to reach an agreement on a trade deal, and the deadline for a deal is fast approaching.
The UK is set to leave the EU at the end of the year, and without a trade deal, the UK could face tariffs and other trade barriers. This could have a negative impact on the UK economy and could weigh on European stocks.
European Markets Reacting to Global Developments
European markets are also reacting to global developments. The US-China trade war is still ongoing, and the US has threatened to impose tariffs on European goods.
The US has also threatened to impose tariffs on European cars, which could have a negative impact on the European auto industry.
European Markets in a Volatile State
European markets are in a volatile state, and investors are uncertain about the outlook for the region. The ECB has taken steps to support the economy, but it remains to be seen if these measures will be enough to boost growth.
The ongoing Brexit negotiations and the US-China trade war are also adding to the uncertainty. Until these issues are resolved, European markets are likely to remain volatile.