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European shares slide as US-China trade dispute ramps up
[LONDON] European stocks fell in early trading on Wednesday as an escalation in the US-China trade dispute looked set to bring a six-session winning streak to an end.
The pan-European Stoxx 600 index was down one per cent by 0712 GMT, while Germany's export-heavy DAX fell 1.2 per cent and Britain's FTSE declined one per cent.
The Trump administration raised the stakes in the standoff with Beijing by threatening to impose 10 per cent tariffs on a list of US$200 billion worth of Chinese imports, a move that hit risky assets globally.
Though investors have been looking positively towards the second-quarter earnings season, the increasingly uncompromising rhetoric on trade has weighed on equities recently.
All European sectors were in negative territory, with those most exposed to action on tariffs took the most points off the Stoxx. Basic resources was down 2.6 per cent and autos down 1.5 per cent.
With the earnings season about to get into gear, trading updates put individual stocks into focus.
Shares in Indivior tumbled almost a third after the drugmaker said its 2018 profit would come in below its forecast, hurt by the launch of generic versions of its bestselling opioid addiction treatment in the United States.
Shares in Burberry were down 4.4 per cent after the luxury retailer gave an update on its first quarter.
UK housebuilder Barratt Developments rose more than 2 per cent after the company said that it expected profits to have risen 9 per cent in 2018.
In M&A news, shares in UK broadcaster Sky retreated one per cent after Rupert Murdoch's 21st Century Fox said it had agreed a US$32.5 billion bid for Sky, trumping a rival offer from US group Comcast.