European Stocks Fall, Weak German Orders

123jump.com Staff
05 Dec, 2008
New York City

European stocks fell sharply in the region after the release of higher than expected unemployment data in the U.S. German factory orders in October dropped 6.1% after dropping 8.3% in September. HSBC will retake its headquarters building from Metrovacesa after it failed to refinance the loan.

[R]9:50 AM New York, 3:50PM Frankfurt – European stocks fell after the U.S. reported sharp jump in unemployment in November.[/R]

German manufacturing orders fell 6.1% in October after dropping 8.3% in September. From the year ago orders declined 16.1%. Export orders in the month declined 6.2% and domestic orders fell 6.1%. For the two months ending in October, domestic orders fell 6.3% and exports orders dropped 12.6%.

All industry groups reported lower orders in October as in September.

Automakers, steelmakers and banks fell sharply in Frankfurt and London trading after the U.S. reported weak employment data. In November 533,000 people lost their jobs in the U.S., the largest decline since 1974 according to the data from the Labor Department.

HSBC Holdings Plc agreed to buy back its headquarters building from the Spanish real estate company Metrovacesa after it failed to refinance the bridge loan provided by the bank. HSBC sold its headquarters in April 2007 for 1.09 billion pounds and provided a bridge loan of 800 million pounds to fund the purchase.

HSBC will take back the building located in Canary Wharf after Metrovacesa failed to refinance the debt after the collapse of real estate market in UK. Central London commercial real estate prices have fallen between 30% and 40% in the last fifteen months.

Europe Markets Review

In London FTSE 100 Index traded lower 51.22 or 1.23% to 4,112.39, in Paris CAC 40 Index decreased 93.67 or 2.96% to 3,067.49 and in Frankfurt DAX index traded lower 125.20 or 2.74% to 4,439.03. In Zurich trading SMI decreased 75.45 or 1.34% to 5,573.69.