European benchmarks nosedived Friday after a string of disappointing earnings reports and policy announcements.
In London the FTSE 100 fell 1.19% to 7,354 and appeared set to eclipse other benchmarks as the worst performer during noon trading after the U.S. Food and Drug Administration delivered a gut-punch to the tobacco industry, sending shares of British American Tobacco (BTI) and Imperial Brands (IMBBY) hurtling toward double-digit losses.
The FDA announced a new plan to the prevalence of smoking by forcing tobacco producers to, among other things, lower the amount of nicotine contained in cigarettes. BAT and Imperial, which are among the world's largest sellers of cigarettes, shares fell by 10% and 7% respectively in response to the announcement.
BT Group (BT) shares also contributed to losses for the FTSE after shedding nearly 2% in response to a sharper than expected fall in pretax profits for the first-quarter. It took another one-off charge, of £225 million ($292 million) to settle warranty claims from two investors relating who were issued shares as part of the payment in BT's acquisition of mobile network EE.
BT shares collapsed in value late last year after it unveiled a black hole in its books due to an accounting scandal at its Italian unit, prompting it to take a £530 million charge at the time.
In Paris, the CAC 40 index sank by 1.42% to 5,113 while the DAX dropped 1.36% to 12,138 in Frankfurt.
Renault (RNSDF) was the top faller on the CAC 40 in Paris, with a loss of 5.5%, after sales in its core auto segment missed expectations. The carmaker saw revenue come in ahead of consensus for the second quarter, however, this was mostly the result of a strong performance in the group's finance unit.