Europe open: Little Xmas cheer as US turns the lights off
There was little to cheer about on European markets as Santa had clearly left town to be replaced by jittery US markets and Washington in stasis over the government shutdown.
The Stoxx 600 index opened in the red as European bourses fell in early trade. With most traders already on holiday and Germany and Italy shut for Christmas eve, volumes were thin.
On Friday, US stocks tumbled amid worries about global economic growth and the temporary US government shutdown. The Dow slumped 1.8% to 22,445.37, the S&P 500 closed down 2.1% at 2,416.62 and the Nasdaq slid 3% to 6,332.99.
The mood was also undermined by comments from President Donald Trump’s acting chief of staff, Mick Mulvaney, who suggested that the government shutdown could continue right up to the opening of the next Congress on 3 January.
Trump and the Democrats remained at odds over funding for a border wall with Mexico.
Comments from White House trade adviser Peter Navarro also did little to help the tone, after he said the US might not reach a trade deal with China in the next three months unless Beijing can agree to a "profound overhaul" of its trade and industrial practices.
In addition, investors were digesting news that US Treasury Secretary Steve Mnuchin held calls with top US bankers over the weekend following the recent selloff in equity markets and convened a "Plunge Protection Team". Rumours about Trump asking whether he could fire Jerome Powell as chair of the Federal Reserve were also circulating.
European shares have fallen almost 14% so far this year and set to record their worst performance since the 2008 financial crash caused by the banks.
Euronext shares fell after the pan-European exchange operator said it was buying the Oslo stock exchange for €625m ($711m).
Anglo American retreated despite raising its 2019 guidance for its Minas-Rio iron ore operation in Brazil after receiving regulatory approval relating to the Step 3 licence area. The mining giant said it now expected production to be 18m -20m tonnes (wet basis), from the previous guidance of 16m -19m.
Whitbread was on the front foot after saying late on Friday that the EU had cleared its sale of the Costa coffee chain to Coca-Cola and announcing a £500m share buyback.