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European shares fall as BASF profit warning hits German stocks

European shares fall as BASF profit warning hits German stocks
FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, June 14, 2019. REUTERS/Staff   -   Copyright  STAFF(Reuters)
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(Reuters) – European shares opened lower on Tuesday in what could be their third straight day of losses as German shares fell sharply due to a profit warning from chemicals giant BASF.

Amid dimming hopes of a sharp cut in U.S. interest rates this month that has been weighing on riskier assets since late last week, the pan-European STOXX 600 index <.STOXX> fell 0.4% by 0714 GMT, in line with Asian peers and Wall Street overnight.

German shares <.GDAXI> tumbled 0.8%.

In the latest evidence of the U.S.-China trade war squeezing businesses, German chemicals firm BASF <BASFn.DE> slumped 5.3% on warning that profit would fall below forecasts for the second quarter and the full year.

This hit fellow chemicals company Bayer <BAYGn.DE>, which fell 1%, taking Europe’s chemicals index <.SX4P> down 1.7%.

Nordic lender Danske Bank <DANSKE.CO>, which has been struggling to restore trust among investors after disclosing a major money laundering scandal at one of its branches, cut its 2019 earnings forecast for the second time, sending its shares 2.5% lower.

Deutsche Bank <DBKGn.DE> fell 1.6%, adding to Monday’s 5.4% slide as it began to slash 18,000 jobs in a 7.4 billion euro (£6.6 billion) “reinvention” that will lead to yet another annual loss.

(Reporting by Susan Mathew in Bengaluru; Editing by Arun Koyyur)

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