Wednesday , July 28 2021

UPDATE 2-European shares wilt again as earnings disappoint, Italian banks drop – Finance News



* STOXX 600 down 0.7 pct

* Mining stocks tumble 1.6 pct

* Italian bank stocks fall just 0.2 pct
(Updates prices, adds details, quotes, graphics)

By Danilo Masoni and Helen Reid

MILAN / LONDON, Nov 22 (Reuters) – European shares resumed
their downward trend on Thursday, hit by disappointing earnings
updates and falling mining stocks, while the Thanksgiving
holiday in the United States kept volumes thin

The pan-European STOXX 600 ended the day down 0.7
percent, with most sectors trading in the red following gains
the previous session that helped the pan-European index bounce
from near two-year lows

Uncertainty over Italian politics, Brexit and worries over
slowing economic and earnings growth have disappointed investors
from taking risks as central banks take steps to end years of
easy monetary policy

Miners were the biggest fallers, down 1.9 percent as
copper prices edged lower on worries over slowing global
economic growth,
Washington and Beijing

Britain's Centrica slid 9.2 percent to lead losers
on the STOXX 600 after its trading update. Analysts at Jefferies
said even though the company
and dividends targets for the year, its earnings per share
guidance was 10 percent below consensus

British industrial group Rotork was another big
Faller, down 9.1 percent after it reported a 4 percent drop in
its order inake

Swedish Match shares tumbled 4.1 percent after the
The European Union's top court stood by an EU ban on the sale
snus, a moist snuff tobacco product made by the company.

Telecoms firm Altice slumped 11.9 percent after
its third quarter
heavy promotions to win customers

"The key challenge for Altitude remains to turn around revenue
and EBITDA trends, "said Credit Suisse analyst Jakob Bluestone
as he lowered his price

Concerns over the global economy
their 2018 estimate for average European corporate earnings
growth to 4.8 percent, from 10 percent
year. Growth in 2019 however is seen rising back to 10 percent

"The market is already price for a further sharp growth
slowdown, "wrote Deutsche Bank European equity analysts.

"Yet, we think this slowdown is unlikely to materialize."

Deutsche Bank argued that cyclical sectors will bounce back
Next year and outperform defensives by 15 percent by April as
fears slow down

The strategists upgraded their recommendation on capital
goods, chemicals, energy, and luxury goods.

Italian banks inched down 0.2 percent after
Wendesday's steep fall, as Italy's bond yields dropped on hopes
a compromise between the Italian government and the European
Commission

Italian lenders are highly sensitive to theirs
big sovereign bond portfolios
rise

Banco BPM climbed 3 percent, the top FTSE MIB
gainer UBI Banca, Banca Generali, and BPER
Banca rose 0.2 to 0.6 percent.

Bearish bets on a number of Italian banks have increased
over the past weeks, reflecting his dim profit outlook and
worries over the euro zone's third-largest economy

(Reporting by Danilo Masoni; Editing by Susan Fenton)

(c) Copyright Thomson Reuters 2018. Click For Restrictions – https://agency.reuters.com/en/copyright.html


Source link