A rout in commodities prices sent European stocks into retreat on Wednesday, right as investor worries regarding China intensified. Investor sentiment, during Wednesday trading, focused on the prospect that ‘China’s slowdown and a prospective U.S. rate increase could potentially hinder corporate profitability and further economic growth.’
Stoxx Europe 600 Index closed Wednesday’s sessions down 1.8 percent, settling at 381.31.
European stocks, in addition to U.S. equities, have been affected by the Chinese stock market‘s unaccustomed volatility. The Shanghai Composite index, on Wednesday, dropped by as much as 5 percent during intraday sessions, closing the day’s sessions with a rally.
Commodities were impacted on the Stoxx 600, with mining companies incurring the most losses. Anglo American declined by 4.4 percent. Boliden AB, a Swedish smelting and mining company, fell by 3.6 percent. Rio Tinto also declined, down 3.7 percent.
Mining conglomerate Glencore declined as much as 9.7 percent, following their report of a first half-year net loss amounting to $676 million, which was below analyst expectations.
Companies in other sectors incurred losses. Carlsberg, a Danish brewer, reported an unanticipated quarterly net loss, which originated from a decline of revenue from its key Russian market. The decline in revenue was said to be caused by ‘unfavorable fluctuations in currency.’
The ongoing commodities sell off has remained on the radar of traders, according to market observers, since it’s caused various China-linked commodities to lose significant momentum.
The Germany DAX 30 finished lower at 2.1 percent, closing at 10,682.15. All thirty components finished the day’s components in the red. The French CAC 40 index also closed down 1.8 percent, settling at 4,884.10.
Greece’s Athex Composite index rallied past losses incurred earlier in the day’s sessions, rising 0.3 percent to close at 675.33. The rally was lifted by the German parliament’s sanctioned an 86 billion euro ($95 billion) bailout deal for Greece.