Europe open: Stocks fall as concerns about Brexit return

European stocks fell in early trade as concerns about the impact of Brexit weighed on investors’ minds ahead of the Bank of England’s financial stability report.

At 0900 BST, the benchmark Stoxx Europe 600 index was down 1.1%, France’s CAC 40 was off 0.9% and Germany’s DAX was off 0.8%.

Mike van Dulken, head of research at Accendo Markets, said the financial stability report could detail the financial risks faced by the UK following the recent Brexit vote. “We may also get details about how it plans to ease the capital burden on banks, to keep financing alive for businesses and households and the economic consumer and business confidence ball up in the air. The press conference by Governor Carney will be a much-watched event for any hints about what stimulus is coming our way this summer.”

In oil markets, West Texas Intermediate was down 1.9% at $48.04 a barrel and Brent crude was off 1.4% at $49.41.

On the corporate front, Italian banks were under pressure again, with Banca Monte dei Paschi di Siena sharply lower amid reports Italy is considering a capital plan for the bank that includes selling new convertible bonds to the government and injecting at least €3bn.

Housebuilder Persimmon was under the cosh despite reporting strong first-half trading, as it said it was too early to judge the impact of Brexit.

Budget airline Ryanair flew higher after reporting a 11% increase in traffic in June.

Data just out from Markit showed the final eurozone composite output index came in at 53.1 in June, down from the flash estimate of 52.8 but in line with the May reading.

Chris Williamson, chief economist at Markit said: “The eurozone economy failed to gain momentum in June, rounding off a disappointing second quarter. Faster manufacturing growth was countered by a slowdown in the service sector, leaving the overall pace of expansion of business activity unchanged since May.”