European shares drop, Nikkei hits six-week low

 

Investors took profits on Monday from recent share rallies in the face of uncertainty over how much longer the current US stimulus would continue, while data underscoring the fragility of China's economy weighed on oil.

 

European stocks followed a fresh dive on Asian markets to open 0.8% lower, as the week, which includes key US jobs data and the monthly meetings of the European Central Bank and Bank of England, got underway.

 

"The overall theme for the coming weeks is going to be a very volatile trading environment and you are going to have the US and Japan being a significant driver to what is happening in Europe," said Rabobank strategist Lyn Graham-Taylor.

 

A mixed reading in Chinese data kept intact worries about its growth momentum and weighed on oil as it slipped to $100 a barrel for the first time in a month, though the figures were not bad enough to trigger active selling in other growth-sensitive commodity or currency markets.

 

In the debt market, safe-haven German bond futures saw as steady start to the week while there was more selling of euro zone periphery debt amid signs it 10-month rally may be drawing to a close.

 

The dollar index, measured against a basket of six key currencies, was down 0.3% as it hovered near the three-week low it hit at the end of last week. The weakness saw the euro start the week up 0.2% at $1.3020.