BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - German stocks tumbled on Wednesday after Chinese newspapers warned Beijing was ready to use its dominance of rare earths as a counter in its trade battle with Washington.
The U.S. imports about 80 percent of its rare earth elements, used in a host of electronic components, from China.
Italy's dispute over its budget with the European Union also kept investors nervous.
The benchmark DAX was down 149 points or 1.23 percent at 11,878 in opening deals after falling 0.4 percent the previous day.
Trade-sensitive auto companies were moving lower, with BMW, Daimler and Volkswagen all falling over 1 percent.
TLG Immobilien declined 0.8 percent. The company has appointed Barak Bar-Hen as a member of the management board.
Software AG shares tumbled as much as 2.5 percent.
In economic releases, Germany's unemployment rate remained stable in April, data from Destatis showed. The jobless rate held steady at adjusted 3.2 percent in April. In the same month last year, the unemployment rate was 3.4 percent.
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