LONDON, Jan 15 (Reuters) - European stocks were set to fall on Friday, as investors digested the latest swings in the oil price which sent U.S. and Asian shares in opposite directions and Chinese shares closed at their lowest level in over a year.
U.S. crude oil futures fell in Asian trade on Friday, heading lower after posting the first significant gains for 2016 in the previous session.
Those gains had supported the U.S. S&P 500 to its best day since December. However, the subsequent fall in oil took the wind out of Asian stock markets, which hit a 3-1/2 year low.
Falling oil hit Shanghai’s Composite Index, which closed at its lowest level since December 2014 even as China’s yuan steadied.
European shares were set to fall again after hitting a 13-month low in the previous session, with the pan-European FTSEurofirst 300 index ending down 1.5 percent at 1,334.36 points.
Despite the fall in the previous session, the index is currently down just 0.5 percent for the week. However traders were cautious ahead of the weekend, and said that further selling pressure would be a negative signal for the medium term.
“Strong risk aversion ahead of the weekly close is a clear vote of no confidence in the markets, which doesn’t bode well for the coming weeks,” Craig Erlam, senior market analyst at OANDA, said in a note.
“It may suggest that rather than seeing stabilisation this week, what we’ve actually witnessed is the calm before the storm.”
Futures on the Euro STOXX50, Germany’s DAX, France’s CAC and Britain’s FTSE were down 0.4-0.8 percent ahead of the cash market open.
The bleak outlook for oil and gas prices prompted global miner BHP Billiton to write down the value its U.S. shale assets by $7.2 billion on Friday, cementing expectations it will be forced to cut its dividend for the first time in over 25 years.
European new car registrations for December due from ACEA at 0700 GMT.
Separately, the European Parliament on Thursday postponed a vote on new car pollution limits that could have killed a compromise agreed by EU members, as politicians argue over whether to seek tougher limits despite the delays that would entail.
Global miner BHP Billiton said on Friday it will write down the value its U.S. shale assets by $7.2 billion on a bleak outlook for oil and gas prices, cementing expectations it will be forced to cut its dividend for the first time in over 25 years.
RENAULT The French carmaker said fraud investigators had inspected three of its sites to look into its vehicle emissions technology - news that wiped billions off its market value in an echo of the scandal engulfing German rival Volkswagen.
The Spanish bank’s UK unit is readying a fresh bid for more than 300 Royal Bank of Scotland branches, Sky news reported on Thursday.
Dialog said it will not increase its takeover offer for Atmel Corporation . Dialog said Atmel is now required to pay Dialog a $137.3 million termination fee.
------------------------------------------------------------------------------ > GLOBAL MARKETS-Asia shares hit 3-1/2-year lows as oil falls > US STOCKS-Energy leads Wall St rebound; S&P has best day since Dec > Nikkei drops as crude prices fall, BOJ says no plans to ease now > TREASURIES-U.S. Treasury bond prices slide on Wall Street rebound > FOREX-Dollar edges down but holding above this week’s lows > PRECIOUS-Gold firms after losses, uptick in risk appetite caps gains > METALS--London copper set for second weekly loss on China worries > Crude oil falls as market braces for more Iranian oil
Reporting by Alistair Smout