By Peter Nurse
Investing.com - European stock markets pushed lower Tuesday, weighed by further signs of economic weakness in Germany, the region’s industrial powerhouse.
At 3:55 AM ET (0705 GMT), the DAX in Germany traded 0.9% lower. France's CAC 40 fell 0.7%, while the U.K.'s FTSE index was down 0.7%.
German exports plunged at a record pace in April, down 31.1% from a year earlier, while imports fell the most since the financial crisis a decade ago.
The German economy is very reliant on trade, and while most companies have since returned to work, uncertainty about the evolution of the pandemic is still depressing orders.
While the European economy is staggering, European Central Bank President Christine Lagarde was forced Monday to defend the stimulus measures taken by the region’s central bank to combat the coronavirus pandemic from criticism by some lawmakers at a hearing in the European Parliament.
This comes after Germany's Constitutional Court gave the ECB three months to justify the massive purchases of government bonds or lose the German Bundesbank as the main buyer in its key debt-buying scheme.
In corporate news, BP (LON:BP) dropped 1.1% after the oil major announced plans to cut 10,000 jobs following a global slump in demand for crude.
The oil giant had paused redundancies during the peak of the pandemic but told staff on Monday that around 15% will leave by the end of the year.
British American Tobacco (LON:BATS) dropped 2.3% after downgrading its revenue growth expectations for the full year despite saying it had been performing well in the first half of the year amid the Covid-19 outbreak.
Oil prices sold off Tuesday, continuing Monday’s strong selloff in what looks an overdue correction after recent hefty gains.
Crude has risen strongly from the lows in April--WTI has jumped 300% and Brent 170%--on a combination of record oil production cuts instigated by the Organization of Petroleum Exporting Countries and its allies, including Russia, and signs of increased demand as the global economy restarted.
At 3:55 AM ET, U.S. crude futures traded 1.1% lower at $37.77 a barrel. The international benchmark Brent contract fell 0.8% to $40.47.
Elsewhere, gold futures rose 0.2% to $1,708.75/oz, while EUR/USD traded at 1.1266, down 0.2%.