European shares fall as uncertain mood prevails, luxury sector hit

Shares in France's LVMH fell 4.2 per cent even as its all-important fashion and leather goods unit did better than expected in the third quarter. — Reuters pic
Shares in France's LVMH fell 4.2 per cent even as its all-important fashion and leather goods unit did better than expected in the third quarter. — Reuters pic

LONDON, Oct 10 ― European shares opened in negative territory today as investors assessed whether worries about global growth warrant the cautious mood which has prompted Wall Street and Asian markets to trade sideways during the previous session.

Adding to the negative sentiment was the broader luxury sector being rattled by lingering fears of a Chinese slowdown.

Shares in France's LVMH fell 4.2 per cent even as its all-important fashion and leather goods unit did better than expected in the third quarter.

Concerns over an ebbing in demand for branded goods among Chinese consumers have hit luxury stocks in recent days, as a trade war between Beijing and Washington simmers.

The pan-European STOXX 600 index was down 0.3 per cent by 0735 GMT while Germany's DAX retreated 0.4 per cent and Paris' CAC 40 lost 0.63 per cent.

Britain's FTSE fell 0.22 per cent as reported progress in EU divorce talks prompted a rise in sterling, which gives an accounting drag to the overseas revenues of British blue chips.

In Italy, Milan's FTSE MIB lost 0.6 per cent with heavy losses from luxury clothing company Moncler, down 5.2 per cent and Fiat Chrysler, losing about 2 per cent.

Italian banks were off 0.3 per cent after a Reuters report said European banking supervisors were stepping up their monitoring of liquidity levels following the rise in sovereign debt yields.

“Uncertainty is prevailing in the financial markets, we are seeing more investors opting to wait and see how risks surrounding rising US treasury yields, global growth and China play out”, wrote Jasper Lawler of LCG in a morning note. ― Reuters