European stocks extended a three-week low, led by a slump in miners. Greek shares tumbled a third day, posting the biggest drop among 18 western-European markets.
The Stoxx Europe 600 Index slid 0.7 percent to 336.83 at 12:17 p.m. in London, with a gauge of commodity producers falling 2.6 percent to its lowest level since July 2013.
“The sector has been taken to the woodshed on slowing growth in China, deflation in Europe and an overall lack of consumption around the world,” said Ion-Marc Valahu, a co-founder and fund manager at Clairinvest in Geneva. “Like the oil sector, the market is unable to find a bottom so far.”
Commodity producers are falling for
a sixth day, the longest streak since September. Iron ore may drop to less than $60 a metric ton next year, according to Roubini Global Economics LLC. Rio Tinto Group and BHP Billiton Ltd., the world’s biggest miners, lost more than 2 percent. Anglo American Plc dropped 3.2 percent to a five-year low.
Greece’s ASE Index also contributed to the losses today. It slid 5 percent today, extending declines this week to 18 percent, the worst since October 2008. The measure slumped the most since 1987 on Dec. 9 on concerns a possible snap parliamentary election would open the door to anti-austerity leadership.
European shares are heading for their biggest weekly drop in two months. The Stoxx 600 reached an almost seven-year high on Dec. 5, with Germany’s DAX Index rising to a record, amid speculation the European Central Bank will consider quantitative easing at its January meeting.
ECB TLTROs
The benchmark gauge briefly erased losses earlier, after the region’s lenders took up 130 billion euros ($161 billion) in the ECB’s second round of long-term loans, lower than the median analyst estimate of 148 billion euros. The targeted TLTROs are meant to spur lending to the real economy.“The issue of liquidity in Europe is key,” Francois Savary, chief investment officer of Reyl & Cie., said by phone from Geneva. “For European equities to outperform the U.S., which we think they will, you need to have liquidity in the system. Will there be QE? If the TLTROs are not working, the ECB needs to add to existing instruments and find other ways of increasing their balance sheet.”
Among companies moving on corporate news, Fiat Chrysler Automobiles NV fell 7.1 percent after pricing an offering of 87 million shares at a discount. Inditex SA rose 2.3 percent after the world’s largest clothing retailer reported an increase in nine-month profit and revenue.
M&A Moves
Some stocks climbed on mergers-and-acquisitions activity. Telecom Italia SpA gained 1.5 percent. Telefonica SA, Oi SA and Claro SA plan to make an offer for Tim Participacoes SA (TIMP3), according to people familiar with the matter. Telecom Italia owns a 67 percent stake in the Brazilian mobile-phone company.Nutreco NV added 4.3 percent. Cargill, the largest closely held company in the U.S., said it’s considering making a stand-alone bid for the Dutch animal-feed supplier.
Standard & Poor’s 500 Index futures added 0.1 percent before U.S. data that may show the world’s biggest economy is strengthening. Reports at 8:30 a.m. in Washington may show retail sales rose at a faster pace in November from a month earlier, while initial jobless claims were unchanged last week.
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