European stock indices were under pressure on Friday from the weakening of banking and oil and metals sector stocks, further pressured by data on the enormous number of job losses in the United States.
The London FTSE index weakened by 1.5 percent to 4,099 points under such circumstances. The Frankfurt DAX index plummeted even more, by almost 3.0 percent, to 4,429 points. Mining stocks were under pressure from falling metal prices, with copper down 4.0 percent and aluminum down 2.0 percent. Shares of BHP Billiton, Anglo American, Vedanta Resources, Lonmin, Kazakhmys, Xstrata, and Antofagasta weakened in a range from 0.2 to 8.8 percent. The oil sector also recorded huge losses due to oil prices falling below $44, the lowest level in the last four years. BP, Royal Dutch Shell, and Total recorded price declines between 4.8 and 7.0 percent. Bank stocks were also among the losers, with shares of the Royal Bank of Scotland down 4.5 percent, BNP Paribas down 3.7 percent, and Barclays down 2.9 percent.
“Markets are trying to assess how deep and how long the crisis in the economy and the slowdown in personal consumption will last,” explains Jonathan Lawlor, head of analysis at Fox-Pitt, Kelton. “Consumers will start taking out loans again, begin shopping, and essentially kickstart economic activities when they feel, for example, greater security regarding their jobs.” Additional pressure on stock indices during the afternoon came from the U.S., due to shocking recent data from the labor market. In November, U.S. employers cut as many as 533,000 jobs, the largest number in the last 34 years.
