(For a live blog on European stocks, type LIVE/ in an Eikon
news window)
* Energy shares only gainer among major sub-sectors
* Airlines lead decliners on STOXX 600
* China industrial output growth weakens in August
(Updates market action, adds comments)
By Shreyashi Sanyal and Sagarika Jaisinghani
Sept 16 (Reuters) - European shares fell on Monday after
four straight sessions of gains as attacks on crude facilities
in Saudi Arabia and weak Chinese data added to worries over
global growth while boosting shares in unaffected oil producers.
The drone attacks on the weekend, which cut more than 5% of
the global oil supply, sent crude prices soaring as much as 19%
and pushed the oil & gas index 2.4% higher, driving
roughly 3% gains for majors BP and Shell.
UK and Irish-based explorer Tullow Oil jumped 7%, to
the top of Europe's STOXX 600, after the firm said it plans to
drill three or more exploration wells in Guyana next year
following its second oil discovery in the country.
All other major European sectoral indexes fell, with travel
and leisure the worst hit with a 1.0% slide, dragged
down by shares of airlines Ryanair Holdings, Air France
KLM SA and EasyJet PLC.
"Usually, higher oil prices are a product of higher demand,
but in a scenario like this where supply is squeezed because of
an attack, that is the worst of both worlds," said David Madden,
market analyst at CMC Markets.
"China's economy is clearly fuelling down; things in the
U.S.-China trade situation are looking a bit better but not
good; Germany is potentially looking toward a recession. The
last thing the global economy now needs is a surge in oil
prices."
Adding to some weak indicators from China last week,
industrial production in the world's second largest economy grew
at its weakest pace in 17-1/2 years in August amid rising U.S.
trade pressure and softening domestic demand.
The pan-European STOXX 600 index and
trade-sensitive German shares were both down 0.6%.
European stocks ended Friday with their fourth straight
weekly gain, as investors circled back into cyclical sectors
amid signs of progress in U.S.-China trade talks.
The European Central Bank also cut rates deeper into
negative territory last week and relaunched bond purchases with
no scheduled end-date, laying down a marker that it would
continue to do all it could to support euro zone growth.
Market participants are now looking to the U.S. Federal
Reserve's policy meeting starting Wednesday, where the central
bank is widely expected to ease interest rates and signal
further moves.
In other corporate news, Volkswagen was down
0.5% as the automaker agreed to pay up to $127 million ($87.3
million) to settle lawsuits brought on behalf of thousands of
Australian customers caught up in its global diesel emissions
cheating scandal.
(Reporting by Shreyashi Sanyal and Sagarika Jaisinghani in
Bengaluru
Editing by Saumyadeb Chakrabarty)
