BRUSSELS, April 12 — European stocks eased from all-time highs today as investors held off from making big bets ahead of the earnings season, while British retailers reopened as the economy emerges from a strict winter lockdown.
The pan-European STOXX 600 index fell 0.4 per cent after closing at a record high on Friday, with banks, commodity and retail sectors among the biggest decliners.
Asian markets slid as investors waited to see if US earnings can justify sky-high valuations, while concerns about a surge in global Covid-19 cases also weighed.
European earnings will kick into higher gear later in April, with analysts expecting a 47.4 per cent jump in first-quarter earnings for STOXX 600 companies, according to Refinitiv IBES data. Much of the support is likely to come from consumer cyclicals and industrial companies.
“Many people are aware that this reporting season is likely to be quite strong for manufacturing companies and much weaker for companies which have been affected by lockdown, the more serviced based businesses,” said Matt Siddle, portfolio manager for European equities at Fidelity International.
“The big question for the market is what happens next. How sustainable is that level of supply-demand and whether spending will be deflected back to services and different parts of the economy.”
UK’s domestically focussed FTSE mid 250 index slid 0.5 per cent, but hovered below a record high as shops, pubs, gyms and hairdressers reopened after three months of lockdown.
Airlines EasyJet and Ryanair fell close to 3 per cent after HSBC downgraded the stocks to “hold” from “buy”.
Meanwhile, Norway’s budget airline Norse Atlantic rose 4.5 per cent in its stock market debut.
Italian diagnostics group DiaSorin SpA jumped 8.6 per cent after it said it will acquire US based Luminex Corp for US$1.8 billion (RM7.4 billion).
French utilities Veolia and Suez gained almost 8 per cent after they agreed upon a merger deal.
Utilities and automakers were the only gainers among European sectors. — Reuters
