The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, April 5, 2019. REUTERS/Staff
April 8, 2019
(Reuters) – European stocks opened broadly lower on Monday following a week of strong gains, as dismal German trade data hurt auto makers and software company SAP dragged the tech sector lower after it announced another departure in its top management.
The pan-region STOXX 600 index was down 0.13 percent at 0723 GMT, having touched eight-month highs last week.
Germany’s trade sensitive DAX index fell 0.3 percent, breaking a seven day winning streak – its longest since October 2017.
Earlier on Monday data showed that German exports and imports fell more than expected in February, the latest sign that Europe’s biggest economy will likely post meager growth in the first quarter.
Auto stocks underperformed after a near 7 percent surge last week.
BMW, Daimler declined, with both facing possibly hefty fines after EU antitrust regulators charged them with colluding to block the rollout of clean emissions technology.
Continental AG fell 1.7 percent as Kepler Cheuvreux downgraded the auto parts maker to “hold” from “buy”.
By contrast Italian-U.S. carmaker Fiat Chrysler Automobiles NV (FCA) rose after it agreed to pay electric carmaker Tesla Inc hundreds of millions of euros to allow Tesla vehicles to be counted in its fleet to avoid fines for violating new EU emission rules.
Software company SAP weighed the most on the STOXX 600 index, down 1.5 percent as Europe’s most valuable technology company said the head of its cloud business group had quit, the latest in a string of top departures.
Irish stocks, a barometer of Brexit sentiment, ended a six-day winning run.
Britain’s government held out the possibility of compromise with the opposition Labour Party on Sunday to try to win support in parliament for leaving the European Union with a deal. UK Prime Minister Theresa May heads to Brussels this week to ask for a further delay until June 30.
Banco BPM dropped 1.3 percent as Italy’s third biggest lender said it could be interested in tie-ups with banks close to its home turf in the north of the country, comments that appeared to play down a possible deal with Monte dei Paschi di Siena.
Deutsche Bank and Commerzbank dropped 0.4 percent and 1.5 percent respectively. European bank supervisors demanded a detailed roadmap outlining the pace and scale of staff cuts in the two lenders as they explore a merger, according to German daily Handelsblatt’s report.
The two German lenders favor a straightforward merger over more complex ways to structure a deal, Reuters reported on Friday.
(Reporting by Susan Mathew and Medha Singh in Bengaluru; Editing by Raissa Kasolowsky)