Europe open: Equities pressured by overnight losses in US and Asia

LONDON (ShareCast) - European stocks slid on Thursday after declines in US and Asian markets overnight coupled with growing concerns about instability in the Middle East in the wake of Saudi Arabia's air strikes on neighbouring Yemen. At 0855 GMT, the UK's FTSE 100 lost 0.3% to 6949 and the DAX in Germany shed 1.2% at 11739.2. France's CAC-40 was off 0.7% at 4981 while Spain's IBEX-35 dropped 1% to 11362. The FTSE MIB index in Italy was down 1.2% and Greece's ASE slumped 2.4%.

The broader Stoxx Europe 600 index shed 0.9% to trade at 394.54.

Europe's declines followed that of deep losses on Wall Street on Wednesday on weak US economic data. The Dow Jones Industrial Average fell 1.6% and the S&P500 lost 1.5%.

The tech-rich Nasdaq 100 slumped 2.4% as investors expressed concerns over deteriorating computer sales, which subsequently weighed on the tech-heavy Japanese Nikkei 225 index which booked losses of 1.4%.

"The declines that set in due to the dismal US data yesterday afternoon have proven difficult to shake, with the Eurozone indices being impervious to the wave of strong figures that have been released this week. With the US futures looking shaky (DJIA and S&P futures down 0.5% and 0.4% respectively) it may take a turnaround at the US open for the losses in Europe to stall," said Connor Campbell, market analyst at Spreadex. Worries about an nstable Middle East rattled market confidence, leading to a spike in oil prices. Nymex and Brent crude futures were up 5.4% to $51.56 per barrel and up 4.6% to $58.94, respectively, after Saudi Arabia and its Gulf Arab allies launched a military operation in Yemen to counter Iran-allied forces besieging the southern city of Aden.

Closer to home, sentiment was also under pressure on news that Greece had failed in a bid on Wednesday to secure a quick cash payment from the Eurozone bank bailout fund to help stave off potential bankruptcy next month. Greece is reportedly set to run out of cash by early April unless its creditors can cough up urgent funding.

In the FX market, the euro extended Wednesday's gains to push up above the $1.1 mark against the US dollar after sagging to a 12-year low versus the greenback earlier this month.

At 0900 GMT, the euro rose 0.7% to changing hands with the US dollar at $1.10402, propped up by news that France's deficit narrowed faster than anticipated to 4% of gross domestic product in 2014, from 4.3% in the previous year.

In company news, advertiser Havas (LSE: 0MGT.L - news) slumped 8% after French billionaire Vincent Bolloré launched an accelerated placement to sell about 17% of his majority stake in French advertising group.

Airliner Lufthansa shares fell 2.4% as investors remained concern about the future of the airline's Germanwings business and its reputation following a crash in the French Alps which killed everyone on-board.

In the aerospace and defence sector, Airbus shares lost 0.8% after it raised €1.64bn from the sale of a 17.5% stake in Dassault Aviation (Paris: FR0000121725 - news) . Meanwhile, in the telecoms sector, Telefonica shares fell 0.3% after it announced on raising €3bn in a rights issue to help fund the purchase of Vivendi (Swiss: VIV.SW - news) 's Brazilian unit GVT.