The European markets ended Wednesday's session in the red, extending its losses from the previous trading day. Investor concerns over a potential U.K. exit of the European Union continued to weigh on the markets after the latest opinion polls showed the "Brexit" campaign has taken a surprise lead in the EU referendum, just few weeks ahead of the polling date.
In its Global Economic Outlook, the OECD reiterated its view that a Brexit vote in the country's referendum this month would depress growth in Europe and elsewhere substantially.
The "Brexit" concerns had a negative impact on homebuilders in London. Bank stocks, especially in the periphery of Europe, turned in another negative performance. Travel and retail stocks were also down after the U.S. issued a terror warning to its citizens regarding travel to Europe over the summer.
Investor sentiment also took a hit after the release of some disappointing Chinese manufacturing data. Mining and resource stocks were under pressure due to the weak data and concerns over the strength of the world's second largest economy.
The manufacturing sector in China continued to contract in May, and at a faster rate, the latest survey from Caixin showed on Wednesday with a Performance of Manufacturing Index score of 49.2. That was in line with forecasts, and it was down from 49.4 in April.
The official manufacturing PMI remained unchanged at 50.1 in May, a survey from the National Bureau of Statistics and the China Federation of Logistics and Purchasing showed today. It was forecast to drop to 50.0.
Investors will be watching for developments from the policy meeting of the European Central Bank on Thursday as well as the meeting of OPEC officials.
The Euro Stoxx 50 index of eurozone blue chip stocks decreased 0.81 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 1.04 percent.
The DAX of Germany dropped 0.57 percent and the CAC 40 of France fell 0.67 percent. The FTSE 100 of the U.K. declined 0.62 percent and the SMI of Switzerland finished lower by 0.38 percent.
In Frankfurt, utility E.ON declined 3.17 percent and peer RWE surrendered 3.14 percent.
Deutsche Bank dropped 2.49 percent and Commerzbank fell 1.69 percent.
BMW decreased 2.62 percent and Volkswagen weakened by 1.90 percent. Daimler also finished lower by 1.95 percent.
In Paris, hotel group Accor fell 4.31 percent and airline Air-France KLM lost 0.47 percent after the United States issued a warning to American citizens visiting Europe this summer, saying terrorists could target major tourist sites, restaurants and commercial centers.
Technicolor advanced 3.33 percent after Morgan Stanley upgraded its rating on the stock to "Overweight" from "Equal weight."
Societe Generale declined 2.24 percent and Credit Agricole weakened 2.08 percent. BNP Paribas also closed down by 1.82 percent.
In London, Wolseley sank 5.50 percent. The plumbing and heating products maker reported decent revenue growth in the third quarter, but cautioned on the outlook.
Property developers were under pressure after an ICM poll published on Tuesday found that voters have swung considerably towards backing Brexit, with 52 percent of people surveyed saying they were planning on voting for Britain to leave the European Union. Berkeley Group dropped 2.90 percent, Barratt Developments fell 3.13 percent and Taylor Wimpey lost 3.75 percent. Persimmon also surrendered 3.04 percent.
Mining stocks were under pressure due to the disappointing Chinese manufacturing data. Rio Tinto dropped 3.84 percent and Antofagasta fell 3.10 percent. BHP Billiton lost 1.93 percent and Glencore surrendered 1.68 percent. Anglo American also finished lower by 1.33 percent.
HSBC finished lower by 0.04 percent, on a Bloomberg report it is cutting senior investment-banking positions as part of its efforts to reduce costs.
Supermarket chain Koninklijke Ahold jumped 2.49 percent in Amsterdam, after reporting higher profit for the first quarter, driven by slid store operations and continued strong increase in online sales.
The Eurozone manufacturing growth slowed as estimated in May as inflows of new work from domestic and export markets continued to rise at lacklustre rates, final data from Markit showed Wednesday. The final manufacturing Purchasing Managers' Index fell to a 3-month low of 51.5 in May, in line with flash estimate, from 51.7 in April.
British manufacturing unexpectedly rebounded in May with modest growth as new order gains were subdued amid the sustained decline in foreign demand, survey data from Markit Economics showed Wednesday. The Markit/CIPS Purchasing Managers' Index for the manufacturing sector rose to 50.1 from 49.4 in April. Economists had forecast a score of 49.6.
U.K. mortgage approvals fell to a near one-year low in April, the Bank of England reported Wednesday. The number of loan approvals for house purchase totaled 66,250 in April versus 70,305 in March. This was the lowest since May 2015, when approvals totaled 64,626. Economists had forecast approvals to fall to 67,900.
UK house price inflation slowed more-than-expected in May to its lowest level in four months, survey figures from the Nationwide Building Society showed Wednesday. The house price index rose 4.7 percent annually following 4.9 percent increase in April. Economists had forecast 4.8 percent gain. The latest figure was the lowest since January, when it was 4.4 percent.
Shop prices in the United Kingdom continued to fall in May, the latest survey from the British Retail Consortium showed on Wednesday, tumbling 1.8 percent on year. That follows the 1.7 percent decline in April.
Economic activity in the U.S. manufacturing sector unexpectedly expanded at a faster rate in the month of May, the Institute for Supply Management revealed in a report on Wednesday. The ISM said its purchasing managers index rose to 51.3 in May from 50.8 in April.
The modest increase came as a surprise to economists, who had expected the index to edge down to a reading of 50.6.
With spending on both private and public construction falling rather sharply, the Commerce Department released a report on Wednesday unexpectedly showing a steep drop in total U.S. construction spending in the month of April.
The Commerce Department said construction spending tumbled by 1.8 percent to an annual rate of $1.134 trillion in April from a revised $1.155 trillion in March.
The sharp pullback came as a surprise to economists, who had expected construction spending to rise by about 0.6 percent.
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Market Analysis
December 19, 2025 15:10 ET U.S. inflation data and interest rate decisions by major central banks were the highlights of this busy week for economics news flow. Employment data and survey results on the housing markets also gained attention in the U.S. In Europe, the European Central Bank and Bank of England announced their policy decisions and macroeconomic projections.