MW: European shares pressured as oil producers fall
Anglo American shares jump after Xstrata outlines merger plan
LONDON (MarketWatch) - Sharp gains from Anglo American shares didn't translate into a positive session for the broader European equity market on Monday, as oil producers came under pressure.
ST:SXXP 206.39, -1.89, -0.91%
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The pan-European Dow Jones Stoxx 600 index (ST:SXXP 206.39, -1.89, -0.91%) declined 0.8% to 206.60.
Oil producers were among the worst performers, with Total (TOT 54.28, +0.18, +0.33%) (FR:FP 38.66, -0.52, -1.33%) shares down 1.4% in Paris and BP (BP 48.83, +1.11, +2.33%) (UK:BP. 489.50, -7.50, -1.51%) shares down 1.5% in London.
The losses came as light sweet crude prices held below $70 a barrel in electronic trading on concerns about global demand. Read more on oil.
On Monday the World Bank predicted that the global economy will shrink 2.9%, a deeper fall than the 1.7% contraction it predicted in March.
It wasn't all bad news in the commodity sector however as shares in mineral extractor Anglo American (UK:AAL 1,750, +127.00, +7.83%) shot up 9.1%.
Over the weekend, Xstrata (UK:XTA 655.00, -26.00, -3.82%) outlined a plan for a 41 billion pound ($67 billion) merger of equals with Anglo American, a deal that would make the combined firm the world's number-three miner behind only BHP Billiton and Vale. See full story.
Xstrata shares declined 3.5%.
On a regional level, the U.K. FTSE 100 index (UK:UKX 4,301, -44.84, -1.03%) fell 0.6% to 4,319.09, the German DAX index (DX:DAX 4,784, -55.33, -1.14%) lost 0.6% to 4,806.19 and the French CAC-40 index (FR:PX1 3,183, -38.39, -1.19%) declined 0.6% to 3,202.36.
Dow Jones Industrial Average futures declined 20 points. Asian shares were higher. Read more on Asian Markets.
Other notable movers included British property investment group Brixton (UK:BXTN 42.00, -20.50, -32.80%) , down 31%.
Segro (UK:SGRO 21.75, -0.75, -3.33%) , another property firm, said that it has reached an agreement with the board of Brixton over the terms of a possible recommended offer.
Under the proposed offer, Segro would swap every Brixton share for 1.75 of its own shares.
Segro also said that any offer would likely be accompanied by a further issue of new shares to raise around 250 million pounds of additional capital.
