European stocks on Tuesday edged back from record levels, over concerns about the prospect of a so-called hard Brexit.
After reaching an all-time record on Monday, the Stoxx Europe 600
dropped 0.72% to 414.76.
U.K. newspapers reported freshly elected Prime Minister Boris Johnson will introduce a legal provision to bar an extension of trade negotiations beyond a year. Analysts say it will be difficult to complete a U.K.-European Union trade deal in a year.
The German DAX
declined 0.9% to 13286.79 and the French CAC 40
fell 0.35% to 5970.92.
The U.K. FTSE 100
only weakened 0.04% to 7516.10, with losses limited by a retreat in the British pound
Since the major multinationals generate most of their revenue outside the U.K., they tend to benefit when sterling weakens.
Lloyds Banking Group
was the worst performing of the U.K. banks, dropping 5.9%. Citi said the stress-test results released by the Bank of England on Monday night suggest it may need to increase its capital buffer.
Virgin Money U.K.
fell 5.5% and the Royal Bank of Scotland
fell 3% as Citi downgraded the lenders to neutral from buy, arguing there is no longer sufficient upside after the big rally on the Conservatives winning the re-election.
Unilever
the Anglo-Dutch household products giant, dropped 7% as the maker of Hellmann’s mayonnaise and Dove soap said a measure of sales growth will miss forecasts.
NMC Health
collapsed by 32% as Muddy Waters said it was shorting the U.K.-listed, Middle Eastern health-services firm. NMC Health shares slammed as Muddy Waters takes short position
