By Sara Sjolin and Carla Mozee, MarketWatch
LONDON (MarketWatch) -- European stock markets moved sharply
lower on Monday, as the late-week rally from Friday ran out of
steam.
The Stoxx Europe 600 index dropped 1% to 315.66, after ringing
up a 2.8% rally on Friday. The Friday rally came after a wider
selloff in European markets throughout the week, where the
pan-European index logged its longest losing streak in more than a
decade.
German stocks were among the hardest hit indexes in last week's
market rout, dropping to the lowest level in a year. On Monday, the
DAX 30 index looked to be suffering another beating, down 1.5% to
8,715.42.
Shares of SAP SE weighed on the German index, down 4.2% after
the software provider lowered its earnings outlook for this
year.
Elsewhere in Europe, France's CAC 40 index fell 1.3% to
3,980.82, while the U.K.'s FTSE 100 index dropped 1%.
Also among standout movers on Monday, shares of Royal Philips NV
slid 4.1% as the Dutch tech company swung to a quarterly net loss
because of a production suspension at one of its health care plants
and a legal provision of 366 million euros ($467 million). (Read
more about European stock movers
http://www.marketwatch.com/story/sap-slides-nutreco-surges-europes-big-stock-movers-2014-10-20.).
Italy's FTSE MIB had been higher earlier after data showed
Italian industrial orders rose in August, the first increase in
four months. But the index succumbed to selling pressure and fell
0.5% to 18,602.46.
Purchasing managers indexes in Europe will be released on
Thursday, "and markets will be keen to see some signs of
stabilization in demand which has been trending lower for the past
quarter," said Boris Schlossberg, managing director of FX strategy
at BK Asset Management, in a note.
The eurozone economy "continues to be the main drag on global
growth and until it shows some signs of life, risk-aversion flows
are likely to continue to roil markets into the year end," he
said.
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