EUROPE’S main index dipped on Tuesday (Mar 5), as mining shares weakened with metal prices on a lack of substantial stimulus from top consumer China, while investors awaited this week’s eurozone and United States economic data and a European Central Bank (ECB) policy decision.
The pan-European Stoxx 600 index shed 0.3 per cent, a day after hitting an all-time high, with technology losing 1.6 per cent, tracking weakness in its US peers.
A ECB interest rate decision is scheduled for Thursday, while eurozone retail sales and gross domestic product reports and a slew of US jobs data are due this week.
“The only thing that would improve the situation from here is either economic growth picking up, a tailwind for stocks, and if the ECB’s cutting rates,” said Michael Field, European market strategist at Morningstar.
“What the ECB doesn’t want to do is back themselves into a corner whereby they promise to cut rates in June, and then you see a backlash in markets.”
China’s ambitious 2024 economic growth target of around 5 per cent missed some investors’ expectations for stimulus measures.
The basic resources sector dropped 0.9 per cent to a four-month low.
China-exposed luxury giants including Hermes and LVMH each lost over 1 per cent, with the broader sector slipping to a near two-week low.
Utilities jumped 1.8 per cent as the battered rate-sensitive sector benefited from a drop in bond yields.
Among headlining stocks, Novo Nordisk dropped 2.5 per cent after hitting a record high in early trade. A study showed its widely used diabetes drug Ozempic delayed progression of chronic kidney disease in diabetes patients, cutting risk of major cardiac events and death by 24 per cent.
Dialysis firm Fresenius Medical gained 11.5 per cent, along with its US peers, after the kidney trial data disappointed some investors.
British equipment rental firm Ashtead slumped 9.4 per cent following a weak rental revenue growth outlook, while Swedish car manufacturer Volvo Car shed 7.6 per cent after lower-than-expected February sales.
Bayer lost 7.6 per cent. The company will hold off on plans to break apart the group for up to three years, leaving investors dubious about whether enough is being done to revive its fortunes.
Norwegian recycling machinery maker Tomra Systems jumped 12.2 per cent, with local analysts citing the European Union’s sustainable packaging deal to cut packaging waste.
France’s Thales climbed 9.1 per cent after unveiling higher-than-expected 2023 sales, cash and profits.
Investors also monitored data showing signs of recovery in eurozone business activity last month, while producer prices in January fell much more than expected month-on-month. REUTERS
