LONDON — European stocks are dropping at the start of trading on Thursday, with all the continent’s major bourses lower soon after the day’s open, against a background of the impending summit between President Trump and China’s Xi Jinping, and following a hawkish set of minutes from the US Federal Reserve.
Britain’s FTSE 100 is nursing the biggest losses as of around 8.15 a.m. BST (3.15 a.m. ET), falling 0.99% to trade at 7,258 points, dragged lower by insurance giant Aviva (down 3.7%) and Lloyds Banking Group (3.4% lower).
Outside the FTSE 100, children’s retailer Mothercare has gained more than 5% in early trading after releasing an upbeat results statement, encompassing strong online growth and solid sales in the UK.
Here’s how the index looks during early trading:
Elsewhere, Germany’s DAX has dipped by 0.75%, while France’s CAC 40 is 0.7% lower. General market sentiment is nervous as a result of Trump and Xi’s meeting, which could end up as a tense affair given Trump’s comments about China in the past.
The Fed’s hawkish stance, which includes many members of its FOMC favouring shrinking its $US4.5 trillion balance sheet, has also hit sentiment.
“The idea of the Fed also beginning to cease re-investment of maturing paper, slowly shrinking its asset pile, at the same time as markets question the validity of the ‘Trump trade’ and deal with plentiful geopolitical risk, has served to spark risk aversion just hours before Trump’s his most crucial summit so far,” Mike van Dulken of Accendo Markets writes in a morning email sent to Business Insider.
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