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Europe: Shares drop as retailers fall after Asos cuts outlook
[MADRID] European shares fell at the open, adding to Friday's losses, as investors enter into pre-Christmas mood.
The Stoxx 600 Europe Index dropped 0.3 per cent, led by falls in retail stocks on contagion from Asos Plc, which plummeted 35 per cent after the British retailer cut its sales growth outlook. Italian stocks fell after an official confirmed the government has reached an agreement on trimming its budget deficit.
With two weeks to finish the year, investors are looking forward to leave behind what is set to be the worst year for European shares since 2011, with the Stoxx 600 Europe Index down 11 per cent. This week's Federal Reserve meeting is the last big event on the agenda before the end of 2018.
"We will start seeing lower volumes and the week should be a quiet one if there are no big surprises," said Diego Fernandez, chief investment officer at A&G Banca Privada in Madrid. "The year is almost finished, with most investors having already re-positioned their portfolios in the last few weeks, so we should be at a wait-and-see mood."
Italy's FTSE MIB dropped 0.3 per cent as the Prime Minister Giuseppe Conte reached an agreement with populist leaders to submit a revised budget proposal to the European Commission.