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European Stocks Slide Second Day as EU Cuts Forecasts, Oil Drops

Tuesday, 04 Nov 2014 04:35 PM

European stocks declined for a second day, as officials cut growth forecasts for the euro region, and oil companies plunged on tumbling prices for the commodity.

Hunting Plc and Seadrill Ltd. retreated more than 5 percent as a gauge of oil-related companies fell the most on the Stoxx Europe 600 Index. Hugo Boss AG slid 5 percent after lowering its 2014 sales outlook. Securitas AB jumped to the highest level in more than seven years after reporting third-quarter net income that beat estimates. Royal DSM NV advanced 1.6 percent after posting quarterly results that beat projections.

The Stoxx 600 slipped 1 percent to 330.88 at the close of trading, extending losses in late afternoon trading. The gauge sank 0.8 percent yesterday, after the year’s biggest weekly rally, amid disappointing earnings from PostNL NV and Holcim Ltd. It has fallen 5.4 percent from a six-year high in June.

“We are seeing markets driven by macro issues and decisions by central banks and politicians,” said Tobias Britsch, who helps oversee about $32 billion at Meriten Investment Management GmbH, in Dusseldorf, Germany. “The earnings season so far has been okay. From a bottom-line perspective, we have seen more than 50 percent beats. Having said that, earnings-per-share growth forecasts for 2014 and 2015 have been reduced slightly.”

Gross domestic product in the 18-nation region will rise by 0.8 percent this year and 1.1 percent in 2015, down from projections for 1.2 and 1.7 percent in May, the European Commission said today. It lowered its projections for Germany, Europe’s largest economy, and said inflation in the euro area will be even weaker than the ECB predicts.

National Indexes

National benchmark indexes fell in 15 of the 18 western European markets today. The U.K.’s FTSE 100 slid 0.5 percent, France’s CAC 40 lost 1.5 percent, and Germany’s DAX dropped 0.9 percent.

A gauge of oil and gas companies fell 3.8 percent. West Texas Intermediate dropped to the lowest intraday level in three years as Saudi Arabia cut prices for crude exports to U.S. customers and Brent extended losses in London.

Hunting lost 5.1 percent to 695.5 pence, while Seadrill dropped 8.6 percent to 141 kroner. Fugro NV declined 12 percent to 9.07 euros, its lowest price since June 2003.

Hugo Boss fell 5 percent to 99.85 euros. The German fashion house forecast 2014 sales will climb 6 percent to 8 percent, down from a previous estimate of high single-digit growth. Hugo Boss cited slower European demand for the cut.

L’Oreal SA retreated 1.3 percent to 122.55 euros. The world’s largest cosmetics maker said third-quarter sales climbed 2.3 percent, compared with the average analyst estimate for a 3.8 percent gain. Chairman Jean-Paul Agon said he expects this year to be the weakest since 2009.

Securitas Profit

Securitas jumped 9.2 percent to 88.65 Swedish kronor. The world’s second-biggest guarding-services provider reported third-quarter net income of 571.9 million kronor ($77.1 million), topping the 556 million kronor that was projected.

DSM rose 1.6 percent to 49.76 euros. The world’s largest vitamin maker reported third-quarter earnings before interest, taxes, depreciation and amortization of 315 million euros ($394 million), beating the 313 million euros estimated by analysts. The company said it’s “firmly” committed to pursuing growth across nutrition and performance-plastics businesses.

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European stocks declined for a second day, as officials cut growth forecasts for the euro region, and oil companies plunged on tumbling prices for the commodity.
Europe, stocks, EU, economy
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2014-35-04
Tuesday, 04 Nov 2014 04:35 PM
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