MW: European stocks fall, head for worst December since 2002
European stocks slid on Wednesday on the back of another selloff in commodities, keeping the region’s benchmark index on track for its worst December in more than a decade.
The Stoxx Europe 600 index SXXP, -0.14% dropped 0.4% to 367.97, deepening its monthly loss to 4.5%. That would mark its worst December since 2002, surpassing even its December 2008 slump that occurred during the financial crisis. It also would mark the biggest monthly drop since August.
The sharp decline for the month comes after the European Central Bank in early December underwhelmed investors by announcing a smaller-than-expected round of easing measures to boost the eurozone economy. A rout in commodity prices this month has also spooked investors and kept a lid on any usual year-end optimism.
Weak oil and metals prices were also in focus on Wednesday, with crude oil sliding more than 2% and weighing on European energy majors.
“There is only one thing on trader’s mind today and this is about the commodity market and how it will pan out next year,” said Naeem Aslam, chief market analyst at AvaTrade, in a note.
“Although, the path of least resistance remains towards the downside when it comes to oil, [...] a lot of juice has already been sequenced out of this trade. Therefore, the wisdom of investing will dictate that one should look for an opportunity to take a long position,” he added.
Shares of SeaDrill Ltd. SDRL, -3.09% dropped 2.5%, TGS-NOPEC Geophysical Co. ASA TGS, +0.07% fell 1.6% and BP PLC BP., -1.12% BP, +0.50% dropped 1.2%.
Indexes: The U.K.’s FTSE 100 index UKX, -0.31% which is heavily-weighted toward commodity companies posted one of the biggest losses in Europe on Wednesday. The benchmark dropped 0.6% to 6,280.04, deepening its monthly loss to 1.2%.
France’s CAC 40 index PX1, +0.02% lost 0.4% to 4,684.33. Germany’s DAX 30 index DAX, -0.40% gave up 0.6%, trimming its yearly gain to 10.1%. German markets are closed on Thursday for New Year’s Eve.
Read: When are European markets closed for Christmas and New Year’s?
Movers: Julius Baer Gruppe AG BAER, +1.71% climbed 2% after the Swiss bank said it has reached an “agreement in principle” with U.S. authorities to settle a long-standing probe of alleged tax evasion.
