European stocks were under pressure Wednesday morning, with investors unnerved over fears of a potential U.S. recession.
The pan-European Stoxx 600 index dipped just below the flatline in morning trade, with sectors and major bourses mixed.
Market players are taking a cautious stance as worries of a slowdown in economic growth linger. U.S. bond markets have in recent days signaled a U.S. recession may be coming, with the U.S. 10-year Treasury yield falling below that of the 3-month bill for the first time since 2007 last week.
Looking at individual stocks, Norsk Hydro climbed to the top of the pan-European benchmark after the firm said it had agreed with Brazil’s federal prosecutor to an assessment that could help it resume full production at its half-shut Alunorte refinery. Shares of the aluminum and renewable energy firm rose 3.6 percent.
Fiat Chrysler also rose above 3 percent, after a Financial Times report said the Italian-American automaker could be the subject of a takeover bid from Renault after separate merger talks with Nissan.
Meanwhile, European Central Bank President Mario Draghi delivered a speech on the health of the European economy and monetary policy. The central banker, who is nearing the end of his leadership, said that a temporary slowdown in growth does not necessarily mean a recession is coming.
Elsewhere, Brexit uncertainty continues to weigh on sentiment. U.K. Prime Minister Theresa May is set to address lawmakers of her own Conservative Party Wednesday, with reports saying she could lay out her own exit date in return for support for her twice-rejected EU withdrawal deal in Parliament.
British lawmakers are due to hold a round of so-called indicative votes — essentially votes on what the course of Brexit should look like — later in the day. This comes after parliamentarians took control of the Brexit process from May’s government.
In dealmaking news, German pharmaceutical company Merck KGaA made a hostile $5.9 billion takeover bid for chemicals firm Versum Materials Tuesday, bypassing management and offering to buy out shares directly from investors.
