European stocks stumble on gloomy Lagarde, oil retreat
December 30 2015 10:12 PM
A man works during the last trading day at the Frankfurt Stock Exchange. The DAX fell 1.1% at 10,743.01 points yesterday.


Europe’s main stock markets stumbled in quiet trade yesterday, the last full trading day of the year, pulling US stocks lower.
Sentiment was dented from the start by comments from the head of the International Monetary Fund, Christine Lagarde, who warned that global economic growth would be “disappointing and patchy” in 2016.
At the European close, London equities were down 0.6% at 6,27.05 points, Frankfurt fell 1.1% at 10,743.01 points and Paris dropped 0.5% at 4,677.14 points.
However the DAX in Germany, Europe’s top economy, finished the full year 2015 9.56% higher at 10,743 points.
On Wall Street, the Dow Jones index was down 0.2%.
“The Eurozone was the source of the biggest losses this Wednesday, a touch of thin trading volumes and a propensity for drama causing the DAX to plunge by around 100 points,” noted Spreadex analyst Connor Campbell.
“Kicking off the day with a warning from Christine Lagarde that global growth in 2016 would be disappointing of course did not help matters,” he said.
Rising US interest rates, China’s slowdown and the effects of low oil prices on producer countries “all mean that global growth in 2016 will be disappointing and patchy”, Lagarde wrote in an article for German business daily Handelsblatt.
“And the medium-term outlook has clouded over, too, because low productivity, ageing populations and the fallout from the global financial crisis are putting the brakes on growth,” she added.
Lower oil prices also weighed on trader sentiment. Weekly inventory data from the US showed rising oil stocks, against analysts’ expectations of a drop in inventories.
Asian markets had a see-saw day, with trading volatile as oil prices retreated, but Tokyo ended on a high note as one of the best performers of 2015.
A brief early rally in Asia gave way to selling in light-volume deals as crude resumed its decline on the back of demand worries and oversupply.
Hong Kong’s Hang Seng index finished 0.53% lower, while Shanghai eked out a 0.26-percent gain.
Seoul lost 0.25% by the close, Singapore was down 0.18% and Taiwan fell 0.17%.
On the upside, Tokyo’s benchmark Nikkei 225 ticked up 0.27% on Japan’s last trading day of the year.
The index climbed more than 9% in 2015 to rank among the world’s top-performing major markets, outpacing most of its rivals in the US and Asia-Pacific.
Japan’s financial markets will be closed today and tomorrow, reopening on January 4 after the New Year’s holiday.
Meanwhile, Sydney finished 1.0% higher and Wellington closed up 0.43%.

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