European Markets Finished Lower As German Bund Sets New Low

(RTTNews) - The majority of the European markets ended Tuesday's session in negative territory, adding to the significant losses of the previous session. Oil prices continued to fall amidst a surge in supplies in both Russia and Iraq. The price of oil has dropped below $50 per barrel.

Investor concerns over a potential Greek exit of the Eurozone continued to weigh on sentiment. Investors are eagerly anticipating the result of the country's general elections, which are slated for January 25.

Also contributing to the negative mood among investors, the yield on the German 10-year bond dropped to an all-time low on Tuesday. The European Central Bank is largely expected to announce further quantitative easing measures at its next meeting. Economic data from the Eurozone also proved disappointing today.

Eurozone economic activity expanded less than initially estimated in December, survey data from Markit Economics showed Tuesday. The final composite output index rose to 51.4 in December from 51.1 in November. The index was below the flash estimate of 51.7.

Germany's service sector logged a moderate growth in December, final survey data from Markit Economics showed Tuesday. The seasonally adjusted services Purchasing Managers' Index remained unchanged at 52.1 in December. According to flash estimate, the index fell to 51.4.

The French service sector returned to growth in December, final data from Markit Economics showed Tuesday. The final services Purchasing Managers' Index rose to 50.6 in December from 47.9 in November. According to preliminary estimate, the sector contracted in December, with reading at 49.8.

The British service sector growth eased more than expected to a 19-month low in December on weak activity and new business, results of a survey by Markit Economics and the Chartered Institute of Purchasing and Logistics showed Tuesday.

The seasonally adjusted Markit/ CIPS Purchasing Managers' Index fell notably to 55.8 in December, the lowest since May 2013, from 58.6 in the previous month. It was forecast to fall marginally to 58.5.

French consumer confidence rose to a 30-month high in December, survey data from the statistical office Insee showed Tuesday. The consumer confidence index came in at 90, the highest since June 2012, from a revised score of 88 in November. Economists had forecast the index to rise to 88 from November's initial score of 87.

The Euro Stoxx 50 index of eurozone bluechip stocks decreased by 0.36 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 0.66 percent.

The DAX of Germany dipped by 0.04 percent and the CAC 40 of France fell by 0.68 percent. The FTSE 100 of the U.K. dropped by 0.79 percent and the SMI of Switzerland dipped by 0.72 percent.

In Frankfurt, SAP declined by 2.09 percent. Merrill Lynch downgraded its rating on the stock to "Neutral" from "Buy."

Lanxess dropped by 0.44 percent, after Goldman Sachs lowered its rating on the stock to "Neutral" from "Buy."

Biotechnology company Qiagen finished lower by 3.85 percent, following a negative broker recommendation.

In Paris, Cap Gemini was among the largest decliners, falling by 3.86 percent.

Total lost 0.15 percent, but Technip climbed by 1.37 percent. In London, Ashtead plunged by 6.18 percent, after its U.S. peer United Rentals Inc. was downgraded.

Tullow Oil fell by 0.08 percent and Royal Dutch Shell lost 0.02 percent.

The increase in the price of gold provided a boost to shares of Randgold Resources, which gained 4.87 percent.

Nestle declined by 0.70 percent in Zurich. Barclays downgraded the food giant to "Equalweight" from "Overweight."

Equity markets in the U.S. have turned negative, after attempting to stage an early comeback. U.S. economic data released today was somewhat disappointing.

With orders for durable and non-durable goods both falling, the Commerce Department released a report on Tuesday showing that new orders for U.S. manufactured goods fell by slightly more than expected in the month of November. The report said factory orders fell by 0.7 percent in November, matching the decrease seen in October. Economists had expected orders to drop by about 0.6 percent.

Activity in the U.S. service sector grew at a notably slower rate in the month of December, according to a report released by the Institute for Supply Management on Tuesday. The ISM said its non-manufacturing index dropped to 56.2 in December from 59.3 in November. Economists had expected the index to show a more modest drop to 58.0.

Investors will be watching for a number of important U.S. economic reports later this week. The FOMC will release the minutes from its most recent meeting Wednesday afternoon and the U.S. jobs report for December is due to be released Friday.