Europe Stocks Have Worst Week in Two Months on Growth Concerns

Biggest European Stocks Decline in Over Two Months
  • Commodity producers lead 2.7 percent weekly drop in Stoxx 600
  • Syngenta jumps on Friday on news it's getting a new bid

Worse-than-forecast data on euro-area growth, coupled with lingering concern about a Federal Reserve rate increase, dragged European stocks to a three-week low.

The Stoxx Europe 600 Index fell 0.8 percent at the close of trading in London, with three-fourths of its shares down, as data showed euro-area gross domestic product in the third quarter increased less than economists had forecast. The measure lost 2.7 percent this week, the most since the beginning of September.

“There are still ongoing concerns about slowing economic growth, and there are other worries about more QE in Europe versus a potential rate increase in U.S., which creates a dichotomy,” said Patrick Spencer, equities vice chairman at Robert W. Baird & Co. in London. “The higher dollar, higher rates and slower growth make investors worry, and the numbers in China haven’t been so great lately.”

The 12 percent rebound that took the Stoxx 600 to its highest level since August last week is being questioned amid weak economic figures, while the Fed prepares to raise interest rates. The equity gauge lost 1.6 percent on Thursday, the most in six weeks, on concern that higher borrowing costs in the U.S. may hamper the global recovery, just as commodities tumbled to their lowest levels since 1999.

All Stoxx 600 industry groups fell on Friday, with retail and household-goods companies sliding the most. Hermes International SCA and Burberry Group Plc dropped more than 3.4 percent. Eurofins Scientific SE slid 4.4 percent after HSBC Holdings Plc recommended selling the shares. Elekta AB dropped 3 percent after saying authorities are investigating its Italian unit for antitrust breach.

Syngenta AG was one of the few companies up, surging as much as 11 percent after people familiar with the discussions said China National Chemical Corp. is in talks to buy the Swiss pesticide maker. 

Energy producers and miners led declines in the Stoxx 600 this week, sliding more than 5 percent. Telecommunication companies were the only ones that didn’t fall among 19 industry groups. They rose just 0.3 percent.

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