EUROPE MARKETS: European Stocks Stumble On Company News, Broker Downgrades
18 November 2017 - 2:34AM
Dow Jones News
By Sara Sjolin, MarketWatch
Euro rises against dollar after concerns Russia probe is moving
closer to Trump
European stocks mostly declined on Friday, heading for a second
straight weekly loss, as disappointing corporate updates and broker
downgrades provided pressure.
Equities were also weighed by a stronger euro against the
dollar, after the greenback stumbled on news top officials from
President Donald Trump's election campaign have been subpoenaed in
a Russia probe.
What are markets doing: The Stoxx Europe 600 index gave up 0.4%
to 383.39, setting it on track for a 1.4% weekly decline.
The pan-European benchmark on Thursday staged a 0.8% rebound
(http://www.marketwatch.com/story/european-stocks-rebound-after-longest-losing-streak-in-a-year-2017-11-16)
as traders stepped in to pick up beaten-down stocks following the
longest losing run of the year.
Germany's DAX 30 index dropped 0.2% to 13,017.46 on Friday,
while France's CAC 40 dropped 0.5% to 5,311.54. The U.K.'s FTSE 100
index slipped 0.1% to 7,381.61.
What are driving markets: Traders continued to watch corporate
earnings, which produced some downbeat news on Friday. Elior Group
(ELIOR.FR) tumbled 16% after the catering group cut its guidance,
while Carillion PLC (CLLN.LN) plunged 34% after warning that
full-year profit will be "materially" lower than what the market
expects.
Meanwhile, broker downgrades were also yanking some stocks
lower. Zara parent Industria de Diseno Textil (ITX.MC), or Inditex
as its known, lost 1.6% after Berenberg cut the stock to sell from
hold. Fresenius SE & Co. (FRE.XE) fell 4.5% after UBS
downgraded the health care company to sell from neutral. United
Utilities Group PLC (UU.LN) gave up 5.2% after HSBC cut the stock
to hold from buy, according to Dow Jones Newswires.
The euro was boosted by a broad-based slide in the dollar
(http://www.marketwatch.com/story/dollar-slips-on-concerns-russia-probe-is-moving-closer-to-trump-2017-11-17)
that came after The Wall Street Journal reported that U.S. special
counsel Robert Mueller's team in mid-October issued a subpoena to
more than a dozen officials
(http://www.marketwatch.com/story/mueller-subpoenaed-trump-campaign-documents-in-october-2017-11-16)
from Donald Trump's campaign, asking them to hand over
Russia-related documents.
Mueller is overseeing an investigation into whether Trump
associates colluded with Russia to meddle in the 2016 presidential
election. Both Moscow and Trump have denied any interference.
The shared currency bought $1.1796, up from $1.1771 late
Thursday in New York. A stronger euro tends to hit stocks of
European exporters, as their products become more expensive for
overseas buyers.
Investors in Europe also continued to track developments in
Washington around the Republican tax -cut plan. The focus is now on
the Senate after the House of Representatives passed a sweeping
bill to overhaul the tax code
(http://www.marketwatch.com/story/house-passes-tax-overhaul-as-spotlight-turns-to-senate-2017-11-16)
on Thursday. But the Republicans' proposed legislation has several
steps to go, with immediate hurdles ahead.
A revised bill moving through the Senate Finance Committee
differs in key respects from the House measure, and would delay the
corporate-rate tax cut until 2019.
Other stock movers: Shares of Sky PLC (SKY.LN) rose 3.7% after
reports Comcast Corp. (CMCSA) and Verizon Communications Inc. (VZ)
are exploring bids to buy
(http://www.marketwatch.com/story/comcast-seeks-to-buy-significant-part-of-fox-verizon-interested-too-2017-11-16)
21st Century Fox Inc.'s (FOX) stake in Sky, among other assets.
Vivendi SA (VIV.FR) rose 4.1% after positive analyst comments
following the French media conglomerate's third-quarter earnings
released late Thursday.
Shares of Altice NV (ATC.AE) slid 11%, continuing a spectacular
losing streak that started in early November when the company
issued a poorly received trading update. The stock has lost 49%
month-to-date.
Draghi in focus: European Central Bank President Mario Draghi in
a speech in Frankfurt
(https://www.ecb.europa.eu/press/key/date/2017/html/ecb.sp171117.en.html)
expressed confidence in the eurozone's economic recovery, saying
the region is "in the midst of a solid economic expansion." The ECB
boss cautioned, however, that inflation remains sluggish,
warranting a "patient and persistent approach to our monetary
policy."
(END) Dow Jones Newswires
November 17, 2017 10:19 ET (15:19 GMT)
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