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European Markets Drop On Italian Budget Concerns

The European markets ended the first day of the new trading week firmly in negative territory. A number of concerns weighed on investor sentiment Monday, including concerns surrounding Italy, rising bond yields and Brexit uncertainty. Traders were also concerned over the unexpected drop in German industrial production.

The sharp drop in the Chinese stock market also contributed to the negative mood among investors. China's Shanghai Composite index fell as much as 3.72 percent to finish at 2,716.51 as traders returned to their desks after a week-long holiday.

The pan-European Stoxx Europe 600 index weakened by 1.11 percent. The Euro Stoxx 50 index of eurozone blue chip stocks decreased 1.06 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 0.90 percent.

The DAX of Germany dropped 1.36 percent and the CAC of France fell 1.10 percent. The FTSE 100 of the U.K. declined 1.16 percent and the SMI of Switzerland finished lower by 0.86 percent.

In Frankfurt, Daimler lost 1.87 percent. Chief Financial Officer Bodo Uebber informed the Chairman of the Supervisory Board that he is not seeking to extend his current appointment ending in December 2019.

In Paris, Total SA fell 1.96 percent after signing a new concession contract with Sonatrach and Alnaft to jointly develop the Erg Issouane gas field located on the TFT Sud permit.

In London, Lloyds Banking Group shed 1.31 percent. The bank is to inject its 13 billion pounds wealth management arm into a new joint venture with Schroders, according to Sky News.

Legal & General Group slid 0.35 percent. The financial services company has completed a 2.4 billion pounds buyout for the Nortel Networks UK Pension Plan, covering around 15,500 pensioner members and around 7,200 deferred members.

Hearing aid maker William Demant sank 10.64 percent in Copenhagen on worries about competition after the FDA approved a hearing aid from Bose.

Norsk Hydro jumped 3.90 percent in Oslo. The aluminum and renewable energy company said it was preparing to resume production at its alumina refinery in Brazil.

Eurozone investor confidence weakened in October largely due to uncertainties about the fiscal policy stance in Italy and the automobile industry in Germany, survey data from think tank Sentix showed Monday.

The investor sentiment index fell more-than-expected to 11.4 in October from 12.0 in September. The expected reading was 11.8.

Germany's industrial production declined unexpectedly in August on a notable weakness in construction, suggesting that the economy lost some momentum in the third quarter.

Data from Destatis showed that industrial output slid 0.3 percent from July, confounding expectations for an increase of 0.5 percent. This was the third consecutive decline in output. Production had decreased 1.3 percent in July.

China's private sector logged a moderate growth in September as improved services activity was offset by softer manufacturing growth, survey data from IHS Markit showed Monday.

The Caixin composite output index rose marginally to 52.1 in September from 52.0 in August. A score above 50 indicates expansion.

At the same time, the services Purchasing Managers' Index picked up to 53.1 from 51.5 a month ago, to signal the strongest increase in activity for three months.

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