BackEuropean shares hit 7-week lows; miners fall
European shares hit 7-week lows; miners fall
PremiumLondon: European shares fell on Wednesday, after muted demand for a German bond auction heightened worries about the euro zone crisis, and weak data from China intensified concerns about a global economic slowdown.
Germany sold €3.65 billion of new 10-year government bonds on Tuesday, in an auction which was technically uncovered after Berlin offered the lowest coupon on record for this maturity.
Banks, exposed to euro zone peripheral debt, were among the fallers. The STOXX Europe 600 Banking Index fell 0.7%.
Miners were also among the biggest fallers, as any slowdown in China, the world’s biggest consumer of metals, is likely to hurt demand.
China’s factory sector shrank the most in 32 months in November as new orders slumped, a preliminary PMI survey showed, reviving worries that China may be headed for a hard landing.
The STOXX Europe 600 Basic Resources Index fell 1.2%, cutting losses from earlier in the session, but it has fallen more than 37% in 2011.
“When it comes to economic growth forecasts for next year, one of the largest incremental positives was China. If that slows, it’s a major negative," said Ian King head of international equities at Legal & General.
At 4:03pm, the FTSEurofirst 300 index of top European shares was down 0.6% at 909.16 points, after earlier hitting its lowest since early October.
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