The European markets dropped again Wednesday, adding to the losses from the previous session. After struggling for much of the day, the markets dropped in late trade following the weak opening on Wall Street.
U.S. tax reform now appears to be a virtual certainty, after the bill was passed by both houses of Congress on Tuesday. Markets had rallied higher in anticipation of U.S. tax reform, but are now heading lower as investors take an opportunity to lock in some profits.
The Bank of England announced on Wednesday that it will allow EU banks and insurers to operated normally in the U.K. post-Brexit and is undertaking a review of its authorizing and supervision policies for international firms.
"The foundation of the Bank of England's approach is the presumption that there will continue to be a high degree of supervisory cooperation between the UK and the EU," the bank said in a statement.
"On this basis, EEA banks and insurers may...apply for authorization to operate as a branch in the UK."
The pan-European Stoxx Europe 600 index weakened by 0.71 percent. The Euro Stoxx 50 index of eurozone blue chip stocks decreased 0.81 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 0.83 percent.
The DAX of Germany dropped 1.11 percent and the CAC 40 of France fell 0.56 percent. The FTSE 100 of the U.K. declined 0.25 percent and the SMI of Switzerland finished lower by 0.90 percent.
In Frankfurt, energy firm Innogy fell 1.01 percent amid news its CEO is leaving with immediate effect.
Pharmaceutical company Stada jumped 8.75 percent after concluding a domination and profit and loss transfer agreement with Nidda Healthcare GmbH.
Furniture retailer Steinhoff, which is facing a credit squeeze following allegations of accounting irregularities, plummeted 34.56 percent.
In Paris, BNP Paribas slid 0.36 percent after reports that it is considering moving 45 internal finance jobs from Paris to Lisbon.
In London, BHP Billiton gained 1.38 percent. The mining giant said it has reached a view to exit from the World Coal Association due to differences between its positions on climate and energy policy.
The euro area current account surplus declined in October, figures from the European Central Bank showed Wednesday. The current account surplus fell to a seasonally adjusted EUR 30.8 billion in October from EUR 39.2 billion in September.
Germany's producer price inflation eased to the lowest level in four months in November, Destatis reported Wednesday.
Producer price inflation slowed to 2.5 percent in November from 2.7 percent in October. This was the lowest since July, when prices climbed 2.3 percent and also slower than the expected growth of 2.6 percent.
UK retail sales sustained its robust growth trend in the run-up to Christmas and is expected to repeat the same next month, but underlying conditions remained tough as the squeeze on earnings continue, survey results from the Confederation of British Industry showed Wednesday.
The retail sales balance dropped to +20 in December from +26 in November, the monthly CBI Distributive Trade Survey showed. That was less than the +30 balance predicted in the previous survey, but in line with economists' expectations.
After reporting a sharp increase in existing home sales in the U.S. in the previous month, the National Association of Realtors released a report on Wednesday showing another jump in existing home sales in the month of November.
NAR said existing home sales soared by 5.6 percent to an annual rate of 5.81 million in November from an upwardly revised 5.50 million in October. Economists had expected existing home sales to rise to a rate of 5.52 million from the 5.48 million originally reported to the previous month.
by RTT Staff Writer
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