A woman walks up steps next to a share price ticker at the London Stock Exchange in the City of London (file). The benchmark FTSE 100 yesterday slid 0.45% to close at 6,342.28 points.
AFP
London
The world’s third-largest merger of brewers SABMiller and Anheuser-Busch InBev failed to boost sentiment on European markets yesterday, as disappointing data out of economic powerhouses China and Germany caused renewed concern about the global economy.
Foster’s maker SABMiller was a major gainer, with its shares jumping 9.0% to £39.48 after it announced that it had agreed a takeover by Anheuser-Busch InBev, the world’s biggest beer producer, for $122bn (£80bn, €107bn) including debt.
Budweiser maker AB InBev, which secured the deal with its fifth offer priced at £44 per SABMiller share, saw its shares climb 1.68% to €100 in Brussels.
But the merger announcement didn’t help London’s benchmark FTSE 100, which slid 0.45% to close at 6,342.28 points.
“It’s been another disappointing session for European markets as the feel good factor of last week gives way to renewed concern about the Chinese economy and a sharper than expected deterioration in German ZEW investor expectations in October, to their lowest levels in a year,” said Michael Hewson, chief markets analyst at CMC Markets.
A more than 20% dive in Chinese imports hit mining stocks in particular, with troubled Glencore shedding 2.6% in Tuesday trading to 118.05 pence.
Meanwhile, a leading survey released yesterday said investor sentiment in Germany has slumped this month as the Volkswagen pollution cheating scandal and slowing emerging markets growth dampen the outlook for Europe’s top economy.
The widely watched investor confidence index calculated by the ZEW economic institute sank 10.2 points from 12.1 last month to just 1.9 points, its lowest level since October 2014, the think tank said in a statement.
“The slowdown in China is not just having a detrimental effect on emerging markets, Germany is also suffering as it has strong trade ties with the region,” said Craig Erlam, senior market analyst at Oanda trading group.
In eurozone shares trading, Frankfurt’s DAX 30 index fell 0.86% to 10,032.82 points and the Paris CAC 40 shed 0.97% to 4,643.38.
The euro rose $1.1381 from $1.1363 late on Monday in New York, with the single currency winning support from expectations of a US rate hike being delayed until next year.
But sterling slid as official data showed that Britain’s annual inflation rate fell back into negative territory in September, hit by lower prices for food and petrol.
The pound retreated to $1.5237 from $1.5347 on Monday.
Traders said the data would put pressure on the Bank of England to delay its plan to start raising British interest rates.
US stocks were flat in midday trade, with traders waiting for earnings reports after the closing bell for clues on the strength of the US economy and thus the possible timing of an interest rate hike.
The Dow Jones Industrial Average edged up 0.04% to 17,138.37 points, while the broad-based S&P 500 slipped 0.02% to 2,017.04, and the tech-rich Nasdaq Composite Index rose 0.04% to 4,840.78.
