European Markets Lower on China Worries

Lucy Stoeva
28 Dec, 2015
New York City

Stock markets edged lower in Europe and trading remained subdued in the holiday-shortened week. adidas expects higher sourcing costs in 2016 due to negative currency effects. Banca Monte dei Paschi sells its loan portfolio to Deutsche Bank. Transocean

[R]4:00 PM Frankfurt – Stock markets edged lower in Europe and trading remained subdued in the holiday-shortened week. adidas expects higher sourcing costs in 2016 due to negative currency effects. Banca Monte dei Paschi sells its loan portfolio to Deutsche Bank. Transocean’s Polar Pioneer contract is terminated by Shell.[/R]

Trading remained subdued in Europe on the first trading day after Christmas as investors avoided making large moves in the holiday-shortened week.

Major markets traded lower in the afternoon as the latest Chinese economic data added to the concerns for the global economy.

The profits of Chinese industrial companies in November fell 1.4% from the previous year, indicating the sixth consecutive month of decline, according to China National Bureau of Statistics.

Nevertheless, November data represent an improvement from the previous month, when Chinese industrial profits fell 4.6% from a year earlier.

In London, the stock exchange was closed for the Boxing Day holiday.

In Frankfurt the DAX index fell 62.04 or 0.6% to 10,665.53 and in Paris, CAC 40 index slipped 37.79 or 0.8% to 4,628.88.

adidas AG slipped 1.6% to €88.77 after the German sport products maker’s CFO Robin J. Stalker said negative currency effects in 2016 may increase sourcing costs with approximately €500 million.

Banca Monte dei Paschi di Siena SpA surged 1.8% to €1.27 after the third-largest Italian bank sold its non-performing loan portfolio with book value of €1 billion to Epicuro SPV Srl, a securitization business financed by affiliates of Deutsche Bank AG.

The transaction is expected to close by the end of this month.

Transocean Ltd plunged 1.9% to 12.65 Swiss francs after the offshore drilling company said Shell opted to terminate its contract for the harsh environment semisubmersible Polar Pioneer before it expires in July 2017.

The rig company will be compensated for the early termination through an undisclosed amount.