Investing.com - European stock markets added to heavy losses during European afternoon trade on Thursday, as market sentiment was hit by fresh concerns over the deteriorating economic situation in the euro zone.
Market players also remained wary ahead of the upcoming Italian general elections over the weekend, amid concerns that a hung parliament could hamper ongoing efforts at economic reforms.
Sentiment was already on the back foot amid concern the Federal Reserve may end its bond-buying program sooner-than-expected.
During European afternoon trade, the EURO STOXX 50 tumbled 1.8%, France’s CAC 40 lost 1.7%, while Germany’s DAX 30 plunged 1.8%.
Market research group Markit said that its preliminary euro zone manufacturing purchasing managers’ index fell to a seasonally adjusted 47.8 in February from a final reading of 47.9 in January.
Analysts had expected the index to ease up to 48.4 in February.
Meanwhile, Germany’s manufacturing purchasing managers’ index rose to a seasonally adjusted 50.1 in February from a final reading of 49.8 in January, moving into expansion territory for the first time in 12 months but slightly below expectations for an increase to 50.5.
The report also showed that service sector activity in Germany expanded at the slowest rate in two months in February, with the services PMI declining to 54.1 from 55.7 in January. Analysts had expected the index to ease down to 55.5.
The data came after a report showing that the French manufacturing PMI rose to 43.6 in February from a final reading of 42.9 in January, compared to expectations for a reading of 43.8.
Service sector activity in France fell to a 48-month low of 42.7 in February from a final reading of 43.6 in January. Analysts had expected the index to ease up to 44.5.
Meanwhile, minutes of the Federal Reserve’s most recent meeting published Wednesday indicated that the bank may wind down its bond-buying program sooner than expected.
The minutes of the Fed’s January meeting showed that policymakers discussed the slowing or stopping of bond purchases even before the job market improves, amid concerns that the policy could cause instability in financial markets.
Financial sector stocks sold off, with French lenders BNP Paribas and Societe Generale down 3.7% and 3.4% respectively, while Germany's Deutsche Bank and Commerzbank lost 3.6% and 2.7% apiece.
Peripheral lenders were also sharply lower, with Italy's Intesa Sanpaolo and Unicredit diving 4.1% and 4.7% respectively, while Spanish banks BBVA and Banco Santander fell 1.9% and 2%.
Elsewhere, Axa shed 2.3% after Europe’s second-largest insurer reported net income that unexpectedly declined in 2012.
Meanwhile, in London, commodity-heavy FTSE 100 tumbled 1.6%, pressured by heavy losses in mining stocks, which tracked commodity prices lower.
Mining giants Rio Tinto and BHP Billiton retreated 2.85% and 3.3% respectively, while shares in copper producers Xstrata and Kazakhmys fell 3.3% and 4.25%.
Financial stocks also trended lower. Barclays slumped 2.4% and HSBC Holdings shed 1.9%, while the Royal Bank of Scotland and Lloyds Banking plunged 1.5% and 2.8% respectively.
In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.2% fall, S&P 500 futures signaled a 0.2% decline, while the Nasdaq 100 futures indicated a 0.4% loss.
Later in the day, the U.S. was to release official data on consumer price inflation as well as the weekly government report on initial jobless claims. The U.S. was also to publish industry data on existing home sales and a report on manufacturing activity in Philadelphia.
Market players also remained wary ahead of the upcoming Italian general elections over the weekend, amid concerns that a hung parliament could hamper ongoing efforts at economic reforms.
Sentiment was already on the back foot amid concern the Federal Reserve may end its bond-buying program sooner-than-expected.
During European afternoon trade, the EURO STOXX 50 tumbled 1.8%, France’s CAC 40 lost 1.7%, while Germany’s DAX 30 plunged 1.8%.
Market research group Markit said that its preliminary euro zone manufacturing purchasing managers’ index fell to a seasonally adjusted 47.8 in February from a final reading of 47.9 in January.
Analysts had expected the index to ease up to 48.4 in February.
Meanwhile, Germany’s manufacturing purchasing managers’ index rose to a seasonally adjusted 50.1 in February from a final reading of 49.8 in January, moving into expansion territory for the first time in 12 months but slightly below expectations for an increase to 50.5.
The report also showed that service sector activity in Germany expanded at the slowest rate in two months in February, with the services PMI declining to 54.1 from 55.7 in January. Analysts had expected the index to ease down to 55.5.
The data came after a report showing that the French manufacturing PMI rose to 43.6 in February from a final reading of 42.9 in January, compared to expectations for a reading of 43.8.
Service sector activity in France fell to a 48-month low of 42.7 in February from a final reading of 43.6 in January. Analysts had expected the index to ease up to 44.5.
Meanwhile, minutes of the Federal Reserve’s most recent meeting published Wednesday indicated that the bank may wind down its bond-buying program sooner than expected.
The minutes of the Fed’s January meeting showed that policymakers discussed the slowing or stopping of bond purchases even before the job market improves, amid concerns that the policy could cause instability in financial markets.
Financial sector stocks sold off, with French lenders BNP Paribas and Societe Generale down 3.7% and 3.4% respectively, while Germany's Deutsche Bank and Commerzbank lost 3.6% and 2.7% apiece.
Peripheral lenders were also sharply lower, with Italy's Intesa Sanpaolo and Unicredit diving 4.1% and 4.7% respectively, while Spanish banks BBVA and Banco Santander fell 1.9% and 2%.
Elsewhere, Axa shed 2.3% after Europe’s second-largest insurer reported net income that unexpectedly declined in 2012.
Meanwhile, in London, commodity-heavy FTSE 100 tumbled 1.6%, pressured by heavy losses in mining stocks, which tracked commodity prices lower.
Mining giants Rio Tinto and BHP Billiton retreated 2.85% and 3.3% respectively, while shares in copper producers Xstrata and Kazakhmys fell 3.3% and 4.25%.
Financial stocks also trended lower. Barclays slumped 2.4% and HSBC Holdings shed 1.9%, while the Royal Bank of Scotland and Lloyds Banking plunged 1.5% and 2.8% respectively.
In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.2% fall, S&P 500 futures signaled a 0.2% decline, while the Nasdaq 100 futures indicated a 0.4% loss.
Later in the day, the U.S. was to release official data on consumer price inflation as well as the weekly government report on initial jobless claims. The U.S. was also to publish industry data on existing home sales and a report on manufacturing activity in Philadelphia.