By Carla Mozee and Sara Sjolin, MarketWatch
Vestas shares hit hard after results; EU growth outlook
lifted
Europe's benchmark stock index logged its biggest daily loss in
more than four months on Thursday, as an early selloff gathered
pace in the afternoon after U.S. stocks opened with losses.
There were big moves in stock prices for certain companies
reporting results, including for Burberry Group PLC, whose shares
tumbled by the most in five years.
What markets are doing: The Stoxx Europe 600 ended down 1.1% at
390.07, marking its biggest one-day percentage loss since June 29,
according to FactSet data. On Wednesday, the regional benchmark
slipped less than 0.1%
(http://www.marketwatch.com/story/european-shares-face-2nd-straight-loss-as-banks-fall-2017-11-08).
"U.S. futures were coming under more pressure than what we've
become accustomed to heading into the open and I think this may
have spread to other markets with investors possibly doubting that
the usual 'buy the dip' mentality would kick in," said Craig Erlam,
senior market analyst at Oanda, in emailed comments.
"Ultimately, markets are meant to see corrections along the way
and this hasn't been the case really throughout the rally recently.
As it stands, I don't think the moves are cause for alarm," he
added.
Germany's DAX 30 index closed 1.5% lower at 13,182.56, while
France's CAC 40 gave up 1.2% to 5,407.75.
The U.K.'s FTSE 100 dropped 0.6% 7,484.10.
The euro traded at $1.1650, up from $1.1596 late Wednesday in
New York.
What's moving markets: Investors continued to juggle corporate
earnings reports. Shares that were deeply punished included
Burberry Group and Vestas Wind Systems A/S. But German lender
Commerzbank AG and AstraZeneca PLC were among those whose shares
advanced.
Looking at the 78% of companies on the Stoxx 600 that have
delivered results, growth in per-share earnings has slowed,
according to research from Deutsche Bank. Growth was at 7.6% in the
third quarter, compared with 26% and 18% in the first and second
quarters, respectively.
In addition, the ratio of companies beating earnings
expectations is at 51%, the lowest since the fourth quarter of
2015, the bank's analysts noted. Euro strength "has offset the
positive impact from a strong growth backdrop during the quarter,"
said Sebastian Raedler, head of European equity strategy at
Deutsche Bank.
Exporters saw their beat ratio drop below 50% for the first time
since 2016, in contrast to eurozone companies with high domestic
revenues, which managed to beat expectations "comfortably," he
said.
Read:Is British leader Theresa May on her way out? Why that's
the fear--and why it matters
(http://www.marketwatch.com/story/is-british-leader-theresa-may-on-her-way-out-why-thats-the-fear-and-why-it-matters-2017-11-09)
Stock movers: Burberry shares (BRBY.LN) (BRBY.LN) slid 10%,
suffering their worst session since September 2012, according to
FactSet data, after the British company warned it doesn't expect
sales growth until fiscal 2021
(http://www.marketwatch.com/story/burberry-shares-drop-as-it-warns-on-sales-2017-11-09).
Vestas Wind Systems A/S shares (VWS.KO) plunged 19% as the
Danish wind-turbine maker cut a full-year margin forecast
(http://www.marketwatch.com/story/vestas-profit-falls-missing-views-trims-guidance-2017-11-09)
as it faces "a market that is seeing accelerated competition and
decreasing profitability." Vestas third-quarter profit and earnings
fell short of expectations.
Shares of Commerzbank AG (CBK.XE) popped up 2.4% as Germany's
second-largest bank said it expects to post a small profit for the
full year
(http://www.marketwatch.com/story/commerzbank-swings-to-profit-but-misses-forecasts-2017-11-09).
The company swung to a profit in the third quarter of EUR472
million euros, but that was less than an consensus estimate of
EUR487 million.
AstraZeneca PLC (AZN.LN) (AZN.LN) slipped 0.6% even as the
drugmaker said third-quarter operating profit rose 12% to $1.15
billion
(http://www.marketwatch.com/story/astrazeneca-profit-up-despite-crestor-hit-to-sales-2017-11-09),
boosted by a one-off tax benefit. But product sales fell 3%
stemming from the loss of the company's exclusivity on Crestor and
Seroquel.
Hikma Pharmaceuticals PLC (HIK.LN) (HIK.LN) was knocked down
4.1% as the company cut its guidance for its generics unit for a
third time.
(http://www.marketwatch.com/story/hikma-cuts-guidance-on-generics-unit-for-3rd-time-2017-11-09)
Economic data: The eurozone economy in 2017 is on track to grow
at its fastest rate in a decade
(http://www.marketwatch.com/story/eurozone-to-grow-at-fastest-rate-in-a-decade-in-2017-says-eu-2017-11-09),
bolstered by robust job creation, rising investment and decreasing
debt, the European Commission said Thursday. The EU body expects
gross domestic product to expand by 2.2% in 2017, up from its 1.7%
forecast in the spring.
France's economy is expected to grow 0.5%
(http://www.marketwatch.com/story/bank-of-france-economy-to-grow-05-next-quarter-2017-11-09)
in the fourth quarter, according to a survey by the Bank of France.
That would continue a run of stronger growth over the past year for
the eurozone's second-largest economy.
German exports and imports declined at the end of the third
quarter
(http://www.marketwatch.com/story/german-imports-exports-fall-in-september-2017-11-09),
according to data from the Destatis statistics agency. Exports
declined by 0.4% in September on the month in adjusted terms and
imports fell 1%
The Royal Institution of Chartered Surveyors said its survey on
U.K. house prices showed slowing growth in October
(http://www.marketwatch.com/story/uk-house-price-growth-slows-misses-views-rics-2017-11-09)compared
with September. Its monthly house price balance dropped 5 points,
to plus 1 in October, below a Wall Street Journal consensus
estimate of a reading of plus 3.
(END) Dow Jones Newswires
November 09, 2017 12:21 ET (17:21 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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