European Equity Benchmarks Close Sharply Lower; Juncker Rebukes UK Brexit Papers

The broad-based major European indices closed sharply lower in Tuesday’s trading session, as media companies and banks weighed on markets.

In economic news, European Commission President Jean-Claude Juncker expressed his disappointment with the U.K. government’s Brexit position papers in a speech in Brussels today.

“I have read with the requisite attention all the papers uttered, produced by Her Majesty’s Government,” said said Juncker. “None really gives me satisfaction, so there are a lot of questions that have yet to be resolved.”

Juncker cited the border problems between the Republic of Ireland and Northern Ireland, as well as the status of the Europeans who live in the U.K., and the status of Britons who live on the continent.

“It must be very clear that we will not enter into any negotiations on the continuation of events,” he said, “I mean the new economic, trade and trade relations between the United Kingdom and Europe before all the issues relating to Article 50 and thus the divorce between the European Union and the United Kingdom.”

Meanwhile, the euro rose sharply against the dollar to $1.20, an 18-month high. The euro was boosted as analysts see the likelihood of rising interest rates in the U.S. diminishing.

In the U.K., house price growth slowed down in August, decelerating to 2.1% from 2.9% in July, according to insurance company Nationwide.

“The slowdown in house price growth to the 2%-3% range in recent months from the 4%-5% prevailing in 2016 is consistent with signs of cooling in the housing market and the wider economy,” said Robert Gardner, Nationwide’s chief economist. “Nevertheless, in some respects the slowdown in the housing market is surprising, given the ongoing strength of the labor market.”

And in France, the Institute for Statistics and Economic Studies (INSEE) reported that in July, household consumption expenditure on goods rebounded by 0.7% in volume terms, after a fall of similar magnitude in June. Consumption of durables, growing since May, accelerated in 0.9% July. Purchases of household durables picked up sharply, rising 2.7%, notably those of consumer electronic devices and household appliances, as well as furniture.

In equities, broadcaster ITV led the FTSE lower in London, falling 4.9%, followed by investment management firm Standard Life, and supermarket operator WM Morrison Supermarkets, which lost 3.8% and 3.7% respectively. Packaging company Smurfit Kappa Group fell 2.9% and construction materials supplier CRH shed 2.7%.

In Frankfurt, media company Prosiebensat 1 Media weighed down the DAX, tumbling 14.5%, followed by Commerzbank, down 3.3%, and industrial group ThyssenKrupp, down 3.1%. Deutsche Bank was off 3%, while pharmaceutical firm Merck KGaA and industrial gasses company Linde dropped 2.1% each.

And in Paris, steel and mining company ArcelorMittal led the CAC into negative territory, falling 2.9%, while communications company Publicis shed 2.3%. Auto parts supplier Valeo and Credit Agricole each fell 2.3%.

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