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Morgan Stanley Sees Possible Downturn as European Stocks Retreat
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European Stocks Extend Losing Streak to a Third Day
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European stocks fell for a third day as investors fretted that central banks may be less willing to use monetary policy to spur economic growth. To Morgan Stanley, the market rout that started last week could well be the start of a more serious downtrend.
Economic and cross-asset indicators show the euro area may have entered a “downturn phase,” where risk assets tend to underperform, Morgan Stanley strategists including Andrew Sheets and Phanikiran Naraparaju wrote in a note dated yesterday. The Stoxx Europe 600 Index closed 1 percent lower, paring earlier losses of as much as 2 percent, with no industry groups gaining.