European stocks slip as China data, Brexit worries counter trade optimism

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(Reuters) – European shares opened lower on Monday, as optimism on the progress made in the Sino-U.S. trade talks was offset by growth fears following weak data from Beijing and fresh Brexit uncertainty.

The pan-European STOXX 600 () was down 0.7% at 7:12 GMT after recording its best session since January on hopes of a trade deal and a Brexit agreement.

Late on Friday, United States and China outlined the first phase of a trade deal and suspended this week’s scheduled U.S. tariff hikes. But existing tariffs remain in place and officials on both sides said much more work is needed before an accord could be agreed.

In the latest sign of weakness in the Chinese economy, data showed a further contraction in exports and imports in September.

Germany’s DAX (), dominated by firms with exposure to China, slipped 0.5%. All country indexes were in the red.

Britain’s domestically-focused mid-caps (), typically sensitive to Brexit news, gave up 1.3% after Friday’s more than 4% surge.

Swiss pharmaceutical companies Roche Holding AG (S:) and Novartis AG (S:) dropped more than 1% each, and were the biggest drags on the main index, after a report that the United States was considering tariffs on Swiss pharmaceutical products.

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