Chinese stocks fall as U.S. data misses expectations


Next Fed minutes, U.S. data and radar clocks – U.S. service stations, Fed minutes.

Aug 16 - A 10 - day run of gains for Chinese stocks fell on Monday after a surprise slowdown in European indicators with commodity-linked stocks falling the most.

The STOXX 600 index rose 0.4% to 473.8, covering a low-level of history seen last week.

Oil and mining stocks fell more than 1% each as commodity prices took a hit after Chinese data raised concerns about faltering demand in the global consumer of metals and oil.

China's factory output and retail sales growth slowed sharply and missed expectations in July as new COVID - 19 outbreaks disrupted business operations.

China-exposed luxury names like LVMH, Cartier-maker Richemont and Gucci-owner Kering fell between 1% and 1,5%.

European markets will pay attention to U.S. and China growth concerns, especially since Europe's data calendar is almost empty today, Jeffrey Halley, a senior market analyst at OANDA, wrote in a note.

The global outbreaks and restrictions would be a game-changer for the Asian recovery, and one could argue, the widespread one as well when one considers the implications to supply chains.

Optimism about the second quarter earnings season, a revival in dealmaking and the pace of vaccinations in Europe drove the benchmark STOXX 600 to record highs last week.

However, major money houses remain mixed about the outlook for equity markets, with Goldman Sachs setting a year-end target of 420 points for the STOXX 600, while Bank of America raised its 12-month target to 520 points.

All eyes will now be on U.S. financial data due this week and the minutes of its July policy meeting to gauge when and how the central bank is going to start tightening its monetary policy.

A Reuters poll of economists shows the European Central Bank is likely to announce long-awaited plans to reverse its pandemic asset purchases in the next quarter.

The French car parts supplier Hella jumped 6% after it agreed to acquire a majority stake in German automotive lighting group Faurecia SE, trumping rival bidders with a 6.7 Billion Euro deal.

Hella, whose shares hit a record high in anticipation of a deal last week, slipped 2.7%.

Lufthansa fell 2.9% after the German finance agency unveiled plans to sell up to a quarter of its 20% stake in the airline.

The broader travel and leisure index was down 1.3% as the fast-growing Delta variant COVID 19 remained a concern, especially as many Asian economies imposed migration restrictions.