European shares fall on economic uncertainty

LONDON Thu Nov 15, 2012 1:38pm IST

LONDON Nov 15 (Reuters) - European equities extended losses on Thursday, echoing a sharp decline overnight on Wall Street, as the rising threat to global growth from the U.S. and Europe prompted investors to reduce their exposure to risky assets.

By 0704 GMT, the FTSEurofirst 300 was down 6.42 points, or 0.6 percent at 1,082.01, having fallen 1 percent on Wednesday, while the euro zone blue chip index fell 0.6 percent to 2,457.77.

Equities fell as U.S. politicians readied themselves for a tough battle over the 'fiscal cliff' of some $600 billion in automatic tax hikes and spending cuts, and ahead of data which is expected to show the euro zone slipped back into recession.

"The global economy faces some severe headwinds. Against that backdrop we see short-term de-risking of portfolios," Abi Oladimeji, head of investment strategy at Thomas Miller Investment, said.

He said the pressures being placed on the global economy in particular from the euro zone and United States, combined with overly bullish investor sentiment in the summer and volatility -- a crude gauge of investor fear -- recently being at multi-year lows made a pretty convincing case for reducing allocations in equities.

With investors seeking safer havens against the backdrop of economic uncertainty, riskier basic resource stocks -- demand for which is acutely tied to the performance of the broader economy -- were early big fallers, down 1.1 percent.

Reforms Push

REUTERS SHOWCASE

Reuters Exclusive

Reuters Exclusive

India looks to sway Americans with nuclear power insurance plan  Full Article 

To Boost Growth

To Boost Growth

Crank up public spending to revive growth - chief economic adviser.   Full Article 

Bold Steps

Bold Steps

SpiceJet rescue plan marks bold bet on Indian aviation recovery.   Full Article 

New Airline

New Airline

Tata, Singapore Air venture Vistara to take off on Jan 9.  Full Article 

Online Sales

Online Sales

Knock knock. Who's there? Amazon's best-selling holiday author.  Full Article 

26/11 Plotter

26/11 Plotter

Pakistan to challenge bail for Mumbai attack "mastermind".  Full Article 

Chinese Economy

Chinese Economy

China revises up size of 2013 economy, sees no effect on 2014 growth.  Full Article 

Reuters Poll

Reuters Poll

BSE Sensex to hit 32,980 by December 2015  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage