European stocks fell after China’s latest weakening of its currency refreshed concerns about the outlook for global growth.
The Stoxx Europe 600 Index slid 1.3 percent to 354.35 at the close of trading, its lowest level since Dec. 14. Commodity producers and carmakers — among the sectors with most sales exposure to China — led declines. Tuesday’s rebound from the worst-ever start to the year was short-lived: Europe’s equity benchmark is down 3.1 percent this week amid signs that China’s slowdown is worse than anticipated.
The yuan fell to the lowest level since at least 2011 after China’s central bank set the currency’s reference rate at an unexpectedly weak level. The move is reminiscent of last August’s devaluation, which stunned financial markets worldwide and sparked a selloff that saw the Stoxx 600 tumble as much as 18 percent from its record. Investors are also watching geopolitical developments after North Korea claimed to have successfully tested its first hydrogen bomb.