European stocks broadly lower ahead of earnings; Dax down 0.32%

Investing.com - European stocks were broadly lower on Tuesday, as markets were jittery ahead of upcoming earnings reports, although upbeat German trade data lent support, as well as comments made by European Central Bank Vice President Benoit Coeure over the weekend.

During European morning trade, the DJ Euro Stoxx 50 fell 0.24%, France’s CAC 40 edged down 0.15%, while Germany’s DAX slid 0.32%.

Official data earlier showed that Germay''s trade surplus widened to €18.8 billion in May, from €17.2 billion in April whose figure was revised down from a previously estimated €17.7 billion. Analysts had expected the trade surplus to narrow to €16.4 billion in May.

European equities found support on Monday after ECB Vice President Benoit Coeure said Sunday that rates will remain on hold for an extended period to ensure monetary stability in the euro zone.

The ECB left all rates on hold at its meeting last Thursday, after cutting rates to record lows in June in a bid to stave off the threat of persistently low inflation in the region.

Financial stocks were broadly lower, as French lenders Societe Generale (PARIS:SOGN) and BNP Paribas (PARIS:BNPP) retreated 0.48% and 0.85%, while Germany''s Deutsche Bank (XETRA:DBKGn) tumbled 1.29%.

Among peripheral lenders, Italy''s Intesa Sanpaolo (MILAN:ISP) and Unicredit (MILAN:CRDI) declined 0.81% and 0.82% respectively, while Spanish banks Banco Santander (MADRID:SAN) and BBVA (MADRID:BBVA) slid 0.31% and 0.81%.

Elsewhere, Air France-KLM (PARIS:AIRF) plunged 5.38% after the airline cut its full-year earnings forecast amid overcapacity on North American and Asian routes, poor demand for freight and the fallout from a dispute with Venezuela.

In London, FTSE 100 slipped 0.22%, weighed by losses in the financial sector.

Shares in Barclays (LONDON:BARC) dipped 0.06% and HSBC Holdings (LONDON:HSBA) edged down 0.18%, while the Royal Bank of Scotland (LONDON:RBS) dropped 0.88% and Lloyds Banking (LONDON:LLOY) lost 1.08%.

Meanwhile, mining stocks were mostly higher as Bhp Billiton (LONDON:BLT) rose 0.28% and Glencore Xstrata (LONDON:GLEN) jumped 1.05%, while Fresnillo (LONDON:FRES) and Rio Tinto (LONDON:RIO) saw shares rally 1.24% and 1.25% respectively.

Marks & Spencer (LONDON:MKS) added to gains, up 0.78%, after the clothing retailer said quarterly revenue at its food unit climbed 1.7%. The company also reported a 12th straight quarterly drop in non-food sales.

In the U.S., equity markets pointed to a steady to lower open. The Dow 30 futures pointed to a 0.07% loss, S&P 500 futuressignaled a 0.13% fall, while the Nasdaq 100 futures indicated a 0.03% dip.

Source:

www.jpost.com

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European stocks end mixed after inflation, France jitters

LONDON (MarketWatch) — European stock markets ended mixed on Monday, with French equities dropping right before the close as the country’s prime minister resigned, while a larger-than-expected drop in euro-zone inflation reignited deflation fears and kept investors on edge.

The Stoxx Europe 600 index XX:SXXP +0.17%  rose 0.2% to close at 334.31, coming off its intraday high of 335.94. For the quarter, the benchmark ended 1.8% higher, marking the third quarterly advance in a row.

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Europe’s week ahead: Crunchtime for the ECB

Pressure is mounting on Mario Draghi and his fellow ECB officials to fight off low inflation, and the policy decision next week will be a close call. Fresh inflation data out Monday could strengthen calls for further easing measures.

The index was lifted by a solid gain for Novartis AG CH:NOVN +3.52%   NVS +4.11%, up 3.5% after the drug maker said it will close its trial of a heart-failure drug early because of the strength of the results so far.

Also pushing higher, ING Groep NVNL:INGA +3.78%  gained 2.8% after the Dutch bank said it will resume paying dividends in 2015.

More broadly, euro-zone consumer-price data were the main event in Europe on Monday. Inflation fell to 0.5% in the currency union in March, below analysts’ expectations and marking the lowest level since late 2009. Economists worry the euro zone may be heading for deflation, which could put the region’s fragile economic recovery at risk. This has raised calls for the ECB to either cut rates or launch new easing measures at its meeting on Thursday.

Meanwhile, the euro EURUSD +0.08%  has steadily increased against the dollar, recently touching its highest level since 2011. That has further added pressure on the ECB to loosen policy.

ECB President Mario Draghi has consistently reassured listeners that the euro zone isn’t heading for deflation, but that the central bank stands ready to act if needed. Howard Archer, chief U.K. and European economist at IHS Global Insight, called the inflation data “uncomfortable and unwelcome news for the ECB” and said the decision on Thursday will be a close call.

“However, the general impression we get from ECB officials’ comments is that the they don’t believe circumstances warrant policy action at this stage, and we still think it is more likely than not that the ECB will sit tight,” he said.

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Data out on Friday showed Spain fell into deflation in March, as high unemployment and weak demand for goods among households and businesses added pressure on consumer prices.

Among country-specific indexes, France’s CAC 40 index FR:PX1 -0.45%  sold off just before the close and ended down 0.5% at 4,391.50 as Prime Minister Jean-Marc Ayraultresigned after his Socialist Party suffered major losses in local elections over the weekend. French President François Hollande will make a televised statement on Monday evening, according to media reports. For the quarter, the CAC rose 2.2%.

Most stocks fell in the Paris benchmark, with Danone SA FR:BN -1.23%  down 1.6% and heavyweight oil firm Total SA FR:FP -0.21%   TOT -0.62%  0.9% lower.

The U.K.’s FTSE 100 index UK:UKX -0.26%  ended 0.3% lower at 6,598.37, extending its quarterly loss to 2.2%.

Germany’s DAX 30 index DX:DAX -0.33%  dropped 0.3% to 9,555.91, but ended the quarter marginally higher.

The German benchmark was earlier in the day helped higher by a stronger-than-expected report on retail sales for February.

In the U.S., stocks traded higher after Federal Reserve Chairwoman Janet Yellen said the Fed’s ”extraordinary” support for the economy will last “for some time to come.” A gauge of Chicago-area businesses tumbled in March, dropping to the lowest level since August to 55.9, which is a 3.9-point fall from February.

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Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin..
Source:www.marketwatch.com

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