Investing.com - European stocks opened sharply lower on Wednesday, tracking their Asian counterparts as the previous session's Chinese rate cut failed to boost investor confidence.
During European morning trade, the EURO STOXX 50 plummeted 1.79%, France’s CAC 40 lost 1.80%, while Germany’s DAX 30 tumbled 1.57%.
The People’s Bank of China cut interest rates by 25 basis points to 4.6% on Tuesday, in a bid to bolster economic growth after a plunge in the country’s stock market.
While the move initially boosted equity markets around the world, the impact didn't last long as investors quickly resumed their focus on the deteriorating outlook for China and its impact on the global economy.
Financial stocks were broadly lower, as French lenders BNP Paribas (PARIS:BNPP) and Societe Generale (PARIS:SOGN) tumbled 1.68% and 1.90%, while Germany's Deutsche Bank (XETRA:DBKGn) and Commerzbank (XETRA:CBKG) lost 0.80% and 2.17%.
Among peripheral lenders, Italy's Intesa Sanpaolo (MILAN:ISP) and Unicredit (MILAN:CRDI) plummeted 1.34% and 1.55% respectively, while Spanish banks BBVA (MADRID:BBVA) and Banco Santander (MADRID:SAN) retreated 1.52% and 1.57%.
Elsewhere, Transocean Ltd (SIX:RIGN) saw shares sink 11.72% after the Swiss offshore rig operator said it plans to halt investor payouts and book 2 billion Swiss francs in asset impairments after an oil price crash.
Also on the downside, Volkswagen (XETRA:VOWG) AG slid 0.87% after the carmaker said sales in China, its biggest market, dropped about 5% in the first seven months of the year.
In London, commodity-heavy FTSE 100 lost 1.61%, weighed by sharp losses in the mining sector.
Shares in Rio Tinto (LONDON:RIO) plummeted 2.38% and Antofagasta (LONDON:ANTO) dove 3.15%, while Anglo American (LONDON:AAL) and Glencore (LONDON:GLEN) plunged 3.36% and 3.62% respectively.
Adding to losses, advertising giant WPP (LONDON:WPP) tumbled 1.25% after reporting an increase of 2.3% in first-half net sales and reiterating its target for full-year revenue, net sales growth and operating margin.
In the financial sector, stocks were also mostly lower. Shares in HSBC Holdings (LONDON:HSBA) lost 1.14% and Barclays (LONDON:BARC) plummeted 1.22%, while Lloyds Banking (LONDON:LLOY) retreated 1.43%. The Royal Bank of Scotland (LONDON:RBS) held steady, with shares inching up just 0.06%.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.80% increase, S&P 500 futures signaled a 0.95% rally, while the Nasdaq 100 futures indicated a 0.80% climb.