European stocks retreated as deteriorating Chinese and U.S. data dented the investor optimism that helped trim January losses last week.
The Stoxx Europe 600 Index slid 0.2 percent to 341.61 at the close, paring earlier declines of as much as 1.2 percent in late trading. The gauge posted its worst January drop since 2008 amid concerns about China’s slowdown and an oil rout. While stimulus from the Bank of Japan and speculation of added measures by the European Central Bank tempered some losses in the past two weeks, anxiety over global growth is returning to the fore.
The Stoxx 600 briefly extended losses after a report showed manufacturing in the U.S. shrank in January for a fourth consecutive month and missed estimates as businesses cut staffing plans. Shares fell earlier as China’s official factory gauge dropped to a three-year low in January, missing forecasts and signaling a record sixth straight month of deterioration. The official services index also slipped.
European stocks have underperformed global equities since reaching a record in April. This was exacerbated in January, as all Stoxx 600 industry groups lost ground, with banks, miners and auto companies the hardest hit. Among national benchmarks, Italy’s FTSE MIB posted the biggest drop, losing 13 percent last month. Germany’s export-heavy DAX Index slid 8.8 percent, for its largest monthly decline since August.
Source : Bloomberg