European shares are lower again Wednesday, as investor caution limits bets amid a growing backdrop of political concerns. While the US-China trade dispute continues, fears are also growing over Brexit and Italy’s budget plans.
In addition, worries over slower China growth are weighing on the luxury goods sector.
By 1250 BST, the EUROSTOXX 600 was down 0.32%, while the EUROSTOXX 50 had lost 0.40%. The German DAX fell 0.61%, the French CAC was 0.69% in the red and the Spanish IBEX was off 0.10%.
Political worries grow
Fears that the US-China trade dispute could weigh on global economic growth continue to permeate the European markets, Wednesday. However, investors are also looking towards other political issues and that is working to weigh on sentiment.
Brexit negotiations continue with little to cheer about, particularly as the UK is under some pressure to come up with a suitable deal before the end of the year, to allow time for preparations for the agreed divorce settlement to go ahead.
Added to that, is the ongoing worry that Italy’s Government and the EU remain on a collision course over its budget and spending plans. The Italian economics minister has attempted to calm nerves by stating discussions are required. However, the EU currently remains firm over its rules and that Italy could break those rules with its current plans.
Luxury goods stocks lose ground
European luxury goods stocks are hurting Wednesday, as investors looking ahead to future demand for the sector appear unhappy with the potential for slower demand from Chinese consumers – the top purchasers of well-known, expensive British and European brands.
LVMH shares sank 5.78% to €269.20 amid those fears, despite an upbeat Q3 report from the brand that owns Louis Vuitton and Moet.
Other luxury brand shares also lost ground:
- Gucci owner, Kering shares fell 5.81% to €397.40.
- Dior shares slid 4.76% to trade at €326.40.