RTTNews - The major European markets may open lower on Tuesday, mirroring the weakness in the U.S. and Asia on concerns about the health of the global economy. Wall Street saw its worst one-day loss in two months overnight, while the major Asian markets posted the strongest declines over the last few weeks on Tuesday, led by commodity and energy stocks on concerns the global economy will take a fairly long time to recover. In economic news, major reports due for the day are German consumer confidence, the Swiss trade balance and the French business confidence.
On Wall Street, stocks tumbled overnight after the World Bank cut its forecast for the global economy and warned of a large decline in international capital flows amidst the financial market fragility. The world bank now forecasts the world economy to shrink 2.9% this year, larger than its earlier prediction of a 1.7% decrease. Caution ahead of the release of key economic reports later this week also kept investor sentiment subdued. The Dow Jones Industrial Average fell 2.35 percent, the Nasdaq Composite shed 3.35 percent and the S&P 500 index lost 3.06 percent.
Crude oil price plunged to its lowest close in 19 days in New York trading on Monday, as optimism on the U.S. economy waned and the world bank said the global recession will be deeper this year than it predicted in March. Crude oil futures for July delivery expired on Monday, settling down $2.62 to $66.93 a barrel, dragged lower by the dollar's strength and Wall Street's weakness. The more-actively traded August crude was last trading weaker at $66.68 a barrel, down 1.21% in Asian trading.
Meanwhile, reacting to the world bank's forecast, the European markets fell for the first time in three days on Monday, weighed down by weakness in energy and mining stocks after crude oil and metal prices dropped.
The FTSEurofirst 300 index of pan-European blue chips fell 2.83%, and the narrower DJ Stoxx 50 index moved down 2.52%. Around Europe, while the U.K.'s FTSE 100 index fell 2.57%, France's CAC 40 index dropped 3.04% and Germany's DAX index tumbled 3.02%.
In corporate news, Aggreko Plc, the global leader in temporary power and temperature control, has issued a trading update prior to entering its close period in respect of the half-year ending 30 June.
France's Club Mediterranee said the Benetton family's Edizione holding has subscribed to 708,000 exchangeable bonds, equivalent to a 2.23 percent stake.
Hypo Real Estate Holding AG said on Monday that it anticipates significant burdens on income for the second quarter as a result of further risk provisions on securities resulting from the financial crisis and economic downturn.
French construction and concession company Vinci SA bagged a EUR323 million contract as leader of a consortium for the second phase of Cairo subway line-3 in Egypt.
Anglo American plc on Monday rejected Anglo Swiss mining company Xstrata plc's proposal for a $68 billion merger of equals between the two companies, saying that the terms proposed by Xstrata were totally unacceptable. The company added that the merger was unattractive for Anglo American shareholders.
Hong Leong Company (Malaysia) Berhad had a notifiable 28.01% interest in the total voting rights in the company as of 18 June, Rank Group Plc said.
Drax announced that it is placing up to 25.5 million new ordinary shares, representing approximately 7.5 per cent of Drax's existing issued ordinary share capital through the book-building route to raise approximately £100m to pay down debt and help maintain Drax's investment grade debt rating.
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