The pan-European STOXX 600 index shed 0.2%, bogged down by a 0.9% loss in healthcare stocks, which dropped from a ten-month high reached in the earlier session
European shares slid on Wednesday following a batch of disappointing earnings reports from companies including HSBC and JDE Peet’s, while investors look out for region-wide consumer confidence data.
HSBC shares dipped 7.1%, set for their biggest one-day decline since March 2020, after the company’s annual profit missed estimates. The broader banks index also dropped 0.8%.
The pan-European STOXX 600 index shed 0.2%, bogged down by a 0.9% loss in healthcare stocks, which dropped from a ten-month high reached in the earlier session.
Shares of Fresenius Medical Care lost 3.4%, extending Tuesday’s decline as analysts flagged a weak outlook for patient volumes from the German dialysis specialist.
We have seen a little bit of weakness (in terms of earnings) in some sectors, which is not surprising, according to Daniela Hathorn, a senior market analyst at Capital.com.
Companies have been struggling as well and having to pay higher wages; financing is also more expensive for them, so it is not uncommon to see a period of weaker earnings, Hathorn added.
Earnings and corporate updates from firms across the continent have been mixed for the quarter, though the benchmark STOXX 600 reached a two-year high recently as investors focus on the possibility of a first interest rate cut by the ECB this year.
Adding to the gloom, basic resources shares shed 1.5%, weighed down by a 5.6% decline in Glencore as the UK miner reported bleak earnings and cut its payout to investors.
Peer Rio Tinto also moved 2.1% down after reporting a drop in annual profit.
Among other movers, coffee company JDE Peet’s forecast 2024 organic sales growth at the low end of its mid-term target, taking its shares 4% down.
