European stocks drop for second day on US-China tensions over Hong Kong

European stocks fell on Friday, to head for the second straight daily loss, on risk-aversion due to escalating geopolitical tensions between the US and China over Hong Kong.

The Stoxx Europe 600 index fell by 0.5% as of 09:05 GMT, after it closed lower by 0.8% yesterday on fears over US-China tensions.

The pan European index opened lower today, to head for the second daily loss, with most European markets and sectors seeing red today.

The banking sector saw the largest losses in Europe today, dropping more than 3%, due to escalating tensions between the US and China.

The Chinese government announced on Thursday plans for a new national security law in Hong Kong, which led US President Donald Trump to say that the US would respond "very strongly".

S&P 500 futures fell 1.1%, after the index closed lower by 0.8% yesterday at Wall Street, posting its second daily loss in 3, on risk aversion.

Back to Europe, the Euro Stoxx 50 index fell 0.6%, the German DAX lost 0.7%, and France's CAC 40 dipped 0.4%.  

In the UK, the FTSE 100 index fell 1.3% to lead the list of losing markets, after British retail sales fell to a new record low in April.