Home Stock & Shares European stocks drop as earnings kick in

European stocks drop as earnings kick in

by Paul
European shares fell on

European shares fell on Tuesday as earnings kick in, Umicore weighs

European shares fell on Tuesday with Belgian battery maker Umicore kicking off a busy week of earnings with a disappointing outlook, while a rally in energy stocks helped cap further losses.

The pan-European STOXX 600 index edged lower after seven straight sessions of gains by 0737 GMT, with all major indices in the red except oil major-heavy London’s FTSE 100 which moved marginally higher.

Earnings started to roll in on a not-so-positive note with battery maker Umicore tumbling to the bottom of STOXX 600 after the Belgian group warned revenue and earnings growth in 2020 will be lower than previous indications due to delays in the electric vehicle and energy storage markets.

Car part suppliers Plastic Omnium and Faurecia also reported first quarter results. Plastic Omnium slid 1.5 percent after warning of a decline in worldwide auto production, but Faurecia rose 1.5 percent after the company met its full-year target.

Belgium’s Melexis, which supplies semiconductor solutions for cars, slipped 6 percent after first quarter net income tumbled and the company said it expects 2019 sales level to remain below the prior year.

Besides earnings, Payments company Wirecard was among biggest decliners after Germany’s markets regulator Bafin’s two-month ban on short-selling ended on Friday.

Ahold Delhaize dipped after the supermarket operator said an 11-day strike at its “Stop & Shop” chain in the United States would hurt margins. Bernstein also downgraded its shares to “neutral”.

Renault fell 1.4 percent after Nissan Motor Co Ltd said it would reject a management integration proposal from its French partner and called for an equal capital relationship, according to a Nikkei report.

The oil and gas sector was among the lone bright spots with Royal Dutch Shell, British Petroleum and Total, up between 1.7 percent and 2 percent.

Oil prices were at 2019 highs on Tuesday after Washington announced all Iran sanction waivers would end by May, pressuring importers, mostly Asian, to stop buying from Tehran.

Surging oil prices, however, took a toll on airline stocks. EasyJet plc. slipped 2.6 percent while International Consolidated Airlines and Lufthansa shed nearly 1.5 percent each.

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