Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Risk-off mood hits European shares; U.S.-China tensions weigh

Stock Markets Aug 02, 2022 12:52PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, August 1, 2022. REUTERS/Staff

By Bansari Mayur Kamdar and Anisha Sircar

(Reuters) -European shares fell on Tuesday as weak global factory data fanned economic slowdown fears, while markets were jittery on simmering U.S.-China tensions over Taiwan.

The pan-European STOXX 600 slipped 0.2%, a day after declining on concerns about a cooling global economy following disappointing euro zone manufacturing activity data.

On Tuesday, U.S. House of Representatives Speaker Nancy Pelosi arrived in Chinese-claimed Taiwan aboard a U.S. military aircraft, the first such visit in 25 years and one that risks pushing relations between Washington and Beijing to a new low.

"After the best month for STOXX 600 in July, European equities are giving back some of those gains to kick off August, suggesting the rally was slightly overdone," said Victoria Scholar, head of investment at Interactive Investor.

"Although Pelosi's visit could create a deeper strain between Beijing and Washington, it is unlikely to result in actual military conflict."

Nonetheless, global markets were jittery, with U.S. stocks struggling for gains and the dollar and gold rallying. [MKTS/GLOB]

"The fact that the timing coincides with renewed jitters about a recession following yesterday’s downbeat PMI indicators globally, investors are nervous about the possibility of China retaliating with fresh trade restrictions on U.S. imports," said Raffi Boyadjian, lead investment analyst at brokerage XM.

In Europe, miners were among the biggest drags, falling 1.4% amid a drop in commodities' prices as traders rushed to safer assets.

Semiconductor stocks such as ASML Holding (NASDAQ:ASML), ASM International (OTC:ASMIY) and BE Semiconductor fell between 1.2% and 2.2%.

Meanwhile, Moody's (NYSE:MCO) Investors Service flagged an increased risk of stagflation in European Union countries.

Across European indexes, UK'S FTSE 100 fell the least among European peers thanks to bumper profits from oil giant BP (NYSE:BP), shares of which firmed 2.8%.

Maersk gained 2.1% after raising its 2022 profit guidance for a second time following a beat in quarterly revenue, as congested supply chains boost freight rates.

Ferrari (NYSE:RACE) gained 1.1% after beating earnings forecasts and reporting record orders for the second quarter, prompting the luxury sports car maker to also raise its full-year targets.

Second-quarter earnings for companies that are part of the STOXX 600 are expected to rise 28.1% from a year earlier, according to Refinitiv, slightly higher than estimates of 23.1% from last week.

Risk-off mood hits European shares; U.S.-China tensions weigh

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
Sign up with Email