European Markets Traded Down After China Reported Weakness In Manufacturing Activities

Bridgette Randall
02 Sep, 2024
London

Stocks struggled on the first day of September after recording sharp gains in August as investors reassessed the economic outlook and future rate path. 

Benchmark indexes in Paris, London, and Frankfurt traded around the flatline after China's manufacturing activities continued to shrink for the fourth month in a row. 

Investors also turned cautious ahead of rate decisions by the European Central Bank in September and the Federal Reserve rate announcements on September 18. 

Market indexes in Europe plunged as much as 10% over the two-week period ending in the first week in August on the worry that the U.S. economy may slowdown amid weakening labor market conditions. 

However, those expectations turned out to be not true following a string of subsequent positive reports on the labor market, factory orders, and inflation. 

Market indexes rebounded over the last three weeks, and the benchmark index in Germany traded at a new high last week. 

 

Europe Indexes and Yields

The DAX index decreased by 0.1% to 18,887.63; the CAC-40 index decreased by 0.1% to 7,622.82; and the FTSE 100 index rose by 0.1% to 8,369.05. 

In the previous week, the DAX index advanced 2%, the CAC-40 index declined 1.1%, and the FTSE 100 index gained 1.5%. 

The yield on 10-year German bonds edged higher to 2.32%, French bonds inched up to 3.04%, the UK gilts edged up to 4.03%, and Italian bonds increased to 3.71%.

The euro edged down to $1.10; the British pound inched higher to $1.31; and the U.S. dollar weakened to 85.05 Swiss cents.

Brent crude increased $0.15 to $77.06 a barrel, and the Dutch TTF natural gas rose by €0.69 to €38.71 per MWh. 

 

Europe Stock Movers

Atos SE decreased 2.9% to €0.80, and the French information technology company lowered its annual revenue outlook citing current weakness in its key markets. 

Rightmove soared 21% to 672.18 pence after the Australian real estate platform operator REA Group confirmed that it is considering a cash and share offer for the UK-based real estate online portal.

Kainos Group PLC dropped 14.7% to 950.0 pence after the Northern Ireland-based company confirmed its annual revenue is likely to be lower than the current market estimates. 

Concurrent Technologies PLC jumped 5.3% to 128.50 pence, and the UK-based maker of embedded solutions for mission-critical applications released record interim results. 

Danske Bank increased 1.2% to DKK 213.20, and the Danish bank appointed Cecile Hillary as new chief financial officer to succeed retiring Stephan Engels. 

Luxury stocks in France and automobile makers in Germany traded down after China's manufacturing activities continued to shrink for the fourth month in a row. 

Kering SA decreased 2.2% to €253.45, Hermes International declined 1% to €2,147.0, and LVMH eased 1% to €667.40. 

Mercedes Benz decreased 1% to €61.67, BMW fell 1% to €83.0, and Ferrari declined 0.4% to €446.10.