Europe Stocks Slide for Fourth Day as Brexit Concerns Intensifyby and
Polls indicate vote on U.K.’s EU membership too close to call
European stock volatility is at highest level since February
European stocks slid to their lowest in almost four months as investor anxiety that the U.K. will leave the European Union deepened.
The Stoxx Europe 600 Index fell 1.8 percent to 326.8 at the close of trading. Shares Friday slumped the most since the nadir of the February selloff as risky assets were shunned before a slew of monetary-policy and political events. The equity gauge has traded in a range of less than 25 points since March, struggling to hold on to gains after surging 16 percent from its February low to an April 20 high. A measure of stock volatility jumped 14 percent today, for its biggest four-day increase since August.
The U.K. holds a referendum on June 23 to determine whether or not to stay in the European Union. Optimism that it will choose to remain has given way to fear in global financial markets since the middle of last week as polls indicated the vote is too close to call. Investors are also bracing for the Federal Reserve’s rate decision and Chair Janet Yellen’s commentary afterward, as well as looking to Spain’s general election scheduled for June 26.
“There are many uncertainties, so we could continue seeing declines and touch new lows in the days to come,” said John Plassard, a senior equity-sales trader at Mirabaud Securities in Geneva. “Even though nobody is expecting a rate hike, everyone will look at what Yellen will say at the press conference. We are 10 days from the Brexit vote, and also days away from the election in Spain, while oil is lower and volatility is the highest in months.”
Italy’s Banca Popolare di Milano Scarl and Banca Monte dei Paschi di Siena SpA slipped at least 9.1 percent, leading a measure of lenders to the worst performance of the 19 industry groups on the Stoxx 600.
Carmakers were also among the biggest decliners. BMW AG fell 1.9 percent after its sales chief told Automobilwoche newspaper that the U.S. market “will stagnate at best” in 2016. Technip SA and Amec Foster Wheeler Plc led energy companies lower as Bank of America Corp. said there is still no reason to turn positive on oil-service providers.
Among stocks moving on corporate news, Siemens AG lost 1.8 percent after Chief Executive Officer Joe Kaeser said his company isn’t bidding for robot-maker Kuka AG. G4S Plc declined 5 percent to its lowest price since March 2009 after confirming that the man suspected of killing 50 people and wounding 53 others in a mass shooting Sunday in Florida was an employee since 2007.