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Market Update

Weekly Losses of 4% in European Markets, Multi-Year Lows in Commodities

Author: Lucy Stoeva
Last Update: 1:00 PM ET December 11 2015

4:00 PM Frankfurt – Market indexes in Germany, France and UK dropped 2% or more and extended weekly losses between 3.7% and 4.4%. Market sentiment remained gloomy after oil, copper and iron ore dropped to multi-year new lows. Copper producer Aurubis tumbled 18% on a profit warning.

European markets continued to decline on Friday on concerns about the global economy amid multi-year lows in commodities, 4-year low in Chinese yuan, and deepening gloom in oil.

Investors remained cautious ahead of the highly anticipated meeting on U.S. interest rate policy next week.

In Germany, inflation rose to 0.4% in November from 0.3% in October, according to Destatis. The data indicates the fastest growth in consumer prices since May 2015.

Wholesale prices continued the downward trend, which started more than two years ago, but the decline rate slowed down to 1.1% on an annual basis, compared with 1.6% in October.

In London trading, FTSE 100 index dropped 122.98 or 2% to 5,966.86 and in Frankfurt the DAX index plunged 268.25 or 2.5% to 10,330.54.

In Paris, CAC 40 index dropped 81.66 or 1.8% to 4,553.75.

For the week, FTSE 100 index slumped 4.4% and the DAX index plummeted 3.7% and the CAC 40 index slipped 3.4%.

Aurubis AG plunged 17.6% to €47.71 after the German copper and precious metals producer warned that its operating pretax profit will decline significantly in the current financial year due to the recent decline in copper prices.

Europe''s largest copper smelter reported revenues in the fourth-quarter ending in September plunged 13.9% from a year ago to €2.53 billion.

Bellway Plc soared 4.5% to 2,684 pence after the U.K.-based home builder said reservation rate has increased by 12% to 165 homes per week, while housing completions for the year are estimated to jump about 10%.

The company expects operating margin to rise to at least 21% and announced a dividend of 52 pence per share, up from 36 pence per share a year ago.

Proxama Plc surged 9% to 49 pence after the U.K.-based mobile payment services provider said it had secured a two-year contract with a North American bank to supply, install, and maintain a network of marketing proximity services.

The network will include 10,000 mobile touch points across the US and Canada and will be the first large-scale network of its kind in the banking sector, said Jon Worley, the head of Proxama’s marketing division.

Schneider Electric SE slumped 3.1% to €53.28 after the French energy management company obtained regulatory approval and finalized the sale of Juno to Acuity Brands for about €350 million.

The deal will result in capital loss of up to €270 million, which will be excluded from the calculation of the 2015 dividend.

Standard Chartered Plc dropped 2.9% to 494.10 pence after the U.K.-based financial services provider completed £3.3 billion equity secondary offering.

Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc