European mining and luxury stock prices tumble as global China rally fades
The European mining and luxury stocks fell on Tuesday, as the stimulus-backed frenzy to buy Chinese-exposed shares faded outside of mainland China. This was after officials failed in their attempts to boost the world's second largest economy. economy.
The STOXX Miners Index fell 4.5% when it opened and, if this early drop is maintained, would be the biggest daily decline since March 2023.
The European luxury brands fell by 2.5%. This was also a result of China's announcement that it would take anti-dumping steps on imports of brandy from the European Union.
Zheng Shanjie, the chairman of China's Economic Planner, told reporters Tuesday that China is "fully confident" in achieving its economic targets by 2024. He said China would take 200 billion yuan (28.35 billion dollars) out of next year budget to invest on projects and support local government.
His failure to provide specific details about new measures to stimulate the economy rekindled doubts in the market as to Beijing's willingness to ensure the economy can recover from its worst slump since the pandemic, and achieve 5% growth.
Hong Kong's Hang Seng Index fell over 8% even though Chinese domestic markets surged after returning from a holiday lasting a week.
In Europe, Antofagasta dropped 5.5%, Anglo American fell 4.7%, and Glencore was down 4.3%. This is in line with the fall in iron-ore futures.
Burberry, Kering, and LVMH all saw their shares fall between 4% and 6%. $1 = 7.0550 Chinese Yuan Renminbi (Reporting and editing by Dhara Raasinghe).
(source: Reuters)
