European markets finish lower as car manufacturers struggle

European markets were firmly in the red on Monday as car manufacturers were among the notable fallers.

Fiat owner Stellantis and Aston Martin both saw shares fall sharply after warning over weaker profits amid pressure from cheaper rivals in China.

In London, wider economic sentiment was dented by confirmed economic growth data for the second quarter.

UK gross domestic product (GDP) grew by less than expected between April and June, according to revised figures from the Office for National Statistics (ONS).

The FTSE 100 finished 83.81 points, or 1.01%, lower to end the day at 8,236.95.

Dan Coatsworth, investment analyst at AJ Bell, said: “It’s remarkable how sentiment can swiftly change direction on the markets.

“After last week’s strong showing led by Chinese stimulus measures, US and European markets were in retreat at the start of the new trading week.

“The FTSE 100 was subject to a widespread sell-off, with only a handful of names making any decent headway, including BP and Hikma Pharmaceuticals.”

Across the Channel, the other main indexes took their cues from a weaker start to trading in China this week.

The Cac 40 ended 2% lower for the day and the Dax index was down 0.68% at the close.

Meanwhile, sterling made gains against the dollar amid increased predictions that the Federal Reserve will cut US interest rates further.

The pound was up 0.2% at 1.340 US dollars, and up 0.41% at 1.202 euros.

In company news, Aston Martin was among the heaviest fallers in London after it warned over annual earnings and slashed vehicle production for 2024 because of supplier disruption and weak demand from China.

It said it would make around 1,000 fewer cars than first planned over the year after being hit by delays to car parts thanks to disruption at some of its suppliers.

The luxury car business saw shares plunge by 24.5% to 120.4p as a result.

Rightmove was the biggest faller on the FTSE 100 after Rupert Murdoch’s REA Group walked away from takeover talks.

It came after Rightmove rejected a fourth approach from REA, which had valued the online property platform at around £6.2 billion.

Rightmove shares finished the day 7.7% lower at 617.4p.

Handbag maker Mulberry was firmly in the red after trading opened as investors digested a heavy slump in sales and concerns over its ability to trade in the long term in an update after the close of trading from Friday.

However, its shares performed a dramatic U-turn after significant shareholder Frasers Group – the retail firm behind Sports Direct – laid down an £83 million takeover approach for Mulberry.

As a result, the luxury firm finished the session up 5.5% at 124p.

The price of oil ticked higher on Monday as tensions grew further in the Middle East following attacks from Israel in Lebanon.

A barrel of Brent crude oil was up by 1.19% to 72.39 dollars (£54.00) as markets were closing in London.

The biggest risers on the FTSE 100 were BP, up 3.55p to 391.7p, Hikma Pharmaceuticals, up 15p to 1,911p, AB Foods, up 10p to 2,333p, Rolls-Royce, up 2.2p to 527.2p, and Next, up 40p to 9,782p.

The biggest fallers on the FTSE 100 were Rightmove, down 51.2p to 617.4p, Smiths Group, down 84p to 1,677p, Intermediate Capital, down 104p to 2,228p, Frasers, down 33.5p to 833.5p, and easyJet, down 20.2p to 520p.