European stocks close in on worst year since 2008

With only 11 days to go European stocks are staring down the barrel of one of the worst performances in a decade, with the recent Santa rally turning into a Christmas rout.

European stocks are down again on Friday following a brutal few days in the build up to Christmas in what is the shaping up to be the worst year for equities in the region since the 2008.

The Stoxx Europe 600 has fallen as much as 0.8% on Friday morning, resulting in an annual loss for the index of around 14%.

Meanwhile, the Euro Stoxx 50 and the Euro Index are both down 0.12 and 0.26 respectively as of 1:45pm GMT, with the former alarmingly close to entering a bear market as even European blue-chip companies can’t escape the negative market sentiment ahead of the Christmas holidays.

Trade tensions and Brexit uncertainty loom large

Yet another day in the red for European equities comes as investors grow increasingly skittish in the face of numerous macroeconomic headwinds.

Trade tensions between the US and China show signs of flaring up again after American officials opted to charge Chinese hackers of espionage.

In Europe, the ever looming and seemingly never-ending Brexit debacle continues to offer businesses little in the way of clarity, applying additional pressure on European equities amid a global economic slowdown.

What’s more, the prospect of the UK bailing out of the bloc without a deal is looking more likely than ever, with the UK prime minister Theresa May reportedly weighing up whether to allow the British people a second referendum as she struggles to garner support for her Brexit deal.

Even good news from China can’t seem to stem the tide of negative sentiment in the financial markets, with its government announcing that it will increase tax cuts and ease monetary policy in a move that will increase demand for European exports.

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