Europe Markets

Europe ends lower on China woes; SABMiller pops 9%

Europe ends lower on China woes; SABMiller pops 9%

European stocks closed in the red on Tuesday as investors failed to shake off fresh concerns about the slowdown in China's economy.

The pan-European STOXX 600 ended the day down around 0.9 percent, with most sectors and country bourses closing in negative territory.

London's FTSE 100 index ended 0.45 percent lower, while its counterparts, the French CAC and the German DAX slipped further, closing down around 1.0 and 0.9 percent respectively.

Asian shares closed lower overnight on Tuesday, with resources names leading losses after weak trade figures out of China.

China's dollar-denominated exports fell 3.7 percent in September from a year earlier, while imports plunged 20.4 percent to chalk up their 11th consecutive month of decline, official data showed.

European industries with a strong presence in China, such as autos, took a hit from the news. Peugeot Citroen and BMW both closed in the red.

Elsewhere in the industry, Volkswagen announced on Tuesday that it would reduce investments by 1 billion euros ($1.1 billion) per year, while accelerating its efficiency program. Shares in the embattled carmaker closed down 2.1 percent.

Basic resource stocks were also hit on the China woes, with Glencore ending down 2.5 percent and Anglo American down 1.8 percent. The overall basic resources sector ended trade sharply lower.

U.S. stocks tried to make gains on Tuesday as investors tried to shake off China fears, amid the first key third quarter earnings reports.

Here's where you're wrong about China

Meanwhile, the International Energy Agency reported Tuesday that global oil demand growth would slow in 2016, to 1.2 million barrels per day from 1.8 million in 2015. Oil prices however were up and down during Europe's session, with Brent last standing at over $50 per barrel, while WTI crude headed towards $48.

Oil and gas stocks closed lower however, with Oslo-listed Seadrill slipping over 3 percent, while Subsea 7 and Tullow Oil also closed in negative territory.

Barclays to name Jes Staley CEO

In other news, Barclays plans to appoint Jes Staley as its new chief executive, a former JPMorgan investment banker, the FT reported Tuesday. Shares in the British bank finished down 2 percent.

Elsewhere, the world's two biggest beer brewers - Anheuser-Busch InBev and SABMiller - edged one step closer to a merger on Tuesday, announcing that they had agreed to a "pact in principle." This would see Belgium's AB InBev buy the U.K.-listed brewer for £44 per share ($67.6) in cash.

AB InBev shares ended 1.7 percent higher, while SABMiller surged 9 percent.

French luxury goods house LVMH reported a slowdown in its key fashion and leather business, but a strong rebound in cognac sales in a mixed set of third-quarter results. The company's stock sank over 3 percent, which dragged down other luxury brands like Christian Dior and Burberry.

German automotive wiring company Leoni saw shares tank 33.5 percent by the close, after the firm lowered its earnings forecast for 2015 and 2016.

The U.K. government has sold its remaining stake in Royal Mail after its privatization in 2013. Shares in the firm ended down 4.2 percent.

ZEW falls sharply, UK inflation negative

On the data front, Germany's October ZEW index of economic sentiment came in at 1.9 points, a sharp drop from the 12.1 points recorded in the previous month and way below expectations. ZEW's current conditions index hit 55.2 points in October, a big drop from the 67.5 points in September.

The ZEW Institute said that the Volkswagen emissions scandal and weakness in emerging markets was weighing on the German growth outlook, but said the economy was unlikely to fall into recession.

Meanwhile, U.K. inflation dipped into negative territory with prices contracting at an annual rate of 0.1 percent in September. The pound dropped lower, as expectations of an interest rate hike from the Bank of England are likely to have been pushed out.