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Galderma up after L'Oreal to buy 10% stake

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OCI Global surges after Woodside Energy ( WDS ) to acquire co's

clean

ammonia project in Texas

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STOXX 600 down 2.2%

(Updated at 0827 GMT)

By Pranav Kashyap

Aug 5 (Reuters) - European shares fell to near six-month

lows amid a global selloff in equities on fears of a slowdown in

U.S. economic growth, with only a handful of stocks trading in

the green.

The pan-European STOXX 600 index was down 2.2% to

487.15 points, its lowest since Feb. 14, by 0827 GMT.

The Euro STOXX volatility index jumped 5.7 points to

30.26, its highest since March 2023.

Fears that the U.S. could be heading towards a recession

have sent investors dashing away from risk assets. Japan's

Nikkei closed 13% lower.

Germany's DAX, France's CAC 40, Britain's

FTSE and Spain's IBEX 35 all fell more than 2%.

"You don't get the Nikkei falling by its largest amount in

nearly 40 years without some kind of repercussions across

European markets," Chris Beauchamp, chief market analyst at IG

Group said.

"These things don't usually stop on a dime, it takes a few

days to sort out... but the initial panic appears to be over."

Energy stocks took the most hit, falling 3.4% after

oil prices dropped 1% as U.S. recession fears offset supply

worries in Middle East.

Financial shares were also hit. Banks lost 3%,

financials services shed 2.8% while the tech sector

slipped 2.1%.

Investors will get a read on U.S. employment in the service

sector from the ISM non-manufacturing survey later in the day.

Last week, a worryingly weak July payrolls report sparked

investor worries on the health of the U.S. economy, spurring a

risk-off sentiment globally.

The STOXX 600 saw its worst week in nearly 10 months on

Friday and fell below the 500-mark for the first time since

April 15.

Markets see a 78% chance of a 50-basis-point cut by the

Federal Reserve on Sept. 18, while traders expect a second cut

by the European Central bank on Sept. 12.

On the data front, growth in euro zone business activity

stalled last month - Purchasing Managers' Index for the currency

union fell to 50.2 in July from 50.9 in June.

Growth in Germany's services sector slowed for the second

consecutive month in July.

Among individual stocks, Galderma gained 6.7% after

L'Oreal said it would acquire a 10% stake in the Swiss

skincare firm from a group of major shareholders.

OCI Global jumped 10.3% after Woodside Energy ( WDS )

said it would acquire the Dutch chemicals maker's clean

ammonia project in Texas for $2.35 billion.

(Reporting by Pranav Kashyap in Bengaluru; Editing by Sonia

Cheema and Mrigank Dhaniwala)