- German factory orders fall
- Russia beefs up troops on Ukraine border
- Italian GDP shrinks
- Eurozone retail PMI drops
FTSE 100: -1.19%
CAC 40: -1.24%
FTSE MIB: -3.13%
IBEX 35: -2.07%
Stoxx 600: -1.43%
European stocks slid after a report showed German factory orders unexpectedly fell and as investors raised concerns over the build-up of Russian troops on Ukraine's border.
German factory orders released on Wednesday morning showed a drop of 3.2% in June from May when they fell a revised 1.6%, according to the Economy Ministry in Berlin. Economists had pencilled in a 0.9% increase.
"The factory orders report for June was consistent with our view that the economy is losing some steam in Germany," according to Barclays Research.
"The softening trend is unlikely to revert any time soon as confidence data, and in particular forward looking indicators, continue to suggest."
Meanwhile, Russia's decision to bolster their military presence along the border with Ukraine looks set to have had a knockdown effect on the markets, with investors in the US and Europe worried about a possible Russian invasion.
The Russian army began military exercises involving more than 100 aircraft near the border with eastern Ukraine on Monday while a further 8,000 troops were deployed over the last couple of days, adding to the 12,000 forces that were already present on the territory.
Russia's increased military presence comes a week after the US and the European Union decided to go ahead with increased economic sanctions on the country for its support of pro-Russian separatists in the regions of Donetsk and Luhansk.
Italy slips back into recession
Italy unexpectedly dropped back into recession in the second quarter, according to the gross domestic product (GDP) data published by the country's national statistics agency Istat.
Second-quarter GDP shrank 0.2% from the prior quarter after the Italian economy shrank 0.1% in the first three months of the year. A recession is defined as two consecutive quarters of contraction.
Another release from Markit showed construction activity in Germany in July improved. The purchasing managers' index (PMI) rose to 48.2 from 45.5 in June. However it was under the 50 level that indicates expansion.
Separately, Markit showed retail activity in July declined in Germany and the Eurozone. The PMI for the retail industry in the Eurozone fell to 47.6 from 50 in June, signalling a contraction. In Germany it declined to 52.2 in July from 56.2 a month earlier.
UK industrial production climbed 1.2% year-on-year in June following a 2.3% gain in May, missing expectations for a 1.5% increase. Manufacturing output was 1.9% higher in June, compared to a 3.7% rise in May and forecasts for a 2.1% jump.
Deutsche Telekom, Swiss Re
Deutsche Telekom slumped on reports that T-Mobile US Inc. plans to turn down Iliad SA's $15bn deal proposal. The German company holds 67% of T-Mobile.
Swiss Re retreated after posting second-quarter earnings that fell short of analysts' estimates.
Standard Chartered was lower following reports the lender has held talks with New York's banking regulator to settle claims.
Ageas gained after the Belgian insurer reed to sell its UK unit Ageas Protect to American International Group.
The euro fell 0.26% to $1.3341.
Brent crude futures rose 0.13% to $104.75 per barrel, according to the ICE.