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European markets close lower amid geopolitical uncertainty; Moller-Maersk up 2.8%

  • The pan-European Stoxx 600 closes down 0.4 percent with most sectors and major bourses in negative territory.
  • After recent losses, Europe's benchmark index has slipped around 6 percent since reaching a 20-month peak in mid-May.
  • Falls followed a fragile Asian session which saw investors move away from riskier assets amid joint U.S. and South Korean military drills.

European markets closed lower on Monday amid persistent geopolitical uncertainty, though mining stocks helped to limit losses.

The pan-European Stoxx 600 ended the day down 0.4 percent with most sectors and major bourses in negative territory. After recent losses, Europe's benchmark index has slipped around 6 percent since reaching a 20-month peak in mid-May.

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FTSE
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DAX
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CAC
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IBEX 35
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Falls followed a fragile Asian session which saw investors move away from riskier assets amid joint U.S. and South Korean military drills.

The risk-off move hit banks the hardest with Europe's banking index down more than 0.9 percent. BNP Paribas, Deutsche Bank, Societe Generale and Commerzbank all ended the day in the red.

Healthcare and chemical stocks were also lower, weighed by losses for Irish drug-maker Shire, which announced Monday that its chief financial officer Jeff Poulton is to depart at the end of the year to join a startup in Boston.

Meanwhile, basic resources stocks were trading 0.1 percent higher on Monday, supported by stronger-than-expected metal prices. London zinc prices rose to its highest level in 10 years on robust demand for steel in China. Mining giants Anglo American and Antofagasta were the top performers in the sector.

Looking at individual stocks, Fiat Chrysler ended the day at the top of the index, up almost 7 percent on news that Chinese car maker Great Wall Motor is interested in the company.

Danish conglomerate A.P. Moller-Maersk announced Monday that it had agreed to sell its oil and gas division, Maersk Oil, to French oil giant Total for $7.45 billion. The deal, which is expected to close in the first quarter of 2018, sent Moller-Maersk's shares 2.8 percent higher.

Rathbone Brothers said Monday it had opened exclusive talks with the Smith & Williamson group of firms regarding a potential all-share merger of the two companies. The London-based investment and wealth management company said that talks had been underway for some time with the boards of both groups expressing confidence that stakeholders would see meaningful benefits. Its shares were initially buoyed by the news but fell into negative territory during afternoon deals.

Bannon, Icahn leave White House

In the U.S., Wall Street shares were largely flat as investors responded to the latest in a string of White House dismissals. On Friday Trump fired his controversial policy strategist, Steve Bannon. His dismissal was shortly followed by the resignation of his special advisor on regulation, Carl Icahn. Icahn reportedly left the administration ahead of a critical magazine article detailing his alleged conflicts of interests and questioning whether he had acted illegally.

Elsewhere, investors were also wary of any flare-up in geopolitical tensions between the U.S. and North Korea as U.S. troops and South Korean forces conducted a joint military exercise on Monday. The war games could hold more potential to provoke than ever after President Donald Trump's "fire and fury" remarks and North Korea's as-yet unpursued plan to target the U.S. Pacific territory of Guam.

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