EUROPEAN shares eased on Wednesday after a four-day rally fuelled by the US-UK and US-China trade deals that relieved some concerns over the global trade war, while downbeat corporate earnings also weighed.
The continent-wide Stoxx 600 index closed 0.24 per cent lower at 543.88, its first loss in five sessions.
The rise had started on Thursday after US President Donald Trump announced a trade deal with Britain, and continued after Beijing and Washington agreed to a 90-day pause on most of the tariffs imposed on each other in April.
“This is standard profit-taking. European investors are approaching some of the global tariff news with a bit more healthy scepticism compared to US investors, and the market is taking a bit of a pause,” said Steve Sosnick, chief market analyst at Interactive Brokers.
The benchmark Stoxx 600 is still well above its early April low, when Trump unleashed universal levies on trading partners, leading to a global equity sell-off.
Goldman Sachs raised its 12-month forecast for the Stoxx 600 to 570 points, from 520, following the US-China trade deal.
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Healthcare shares were the biggest drag on the market on Wednesday, down 1.5 per cent. Alcon logged its biggest one-day fall since March 2020 after missing expectations for quarterly results and revising its 2025 outlook to reflect the impact of US tariffs.
Most sectors ended the day lower, although European banks rose 1.4 per cent to trade at the highest since August 2010.
Earnings remained front and centre, with investors hawk-eyed for clues on how companies are planning to navigate the uncertain economic environment.
Train-maker Alstom slumped to the bottom of the Stoxx 600 with an decline of more than 17 per cent after its forecast for the current year disappointed investors, weighing on industrials.
TUI, Europe’s largest travel operator, was down about 11 per cent after flagging a 1 per cent drop in summer bookings, while Imperial Brands dropped 7.3 per cent after the cigarette maker said CEO Stefan Bomhard will retire.
Burberry jumped 17 per cent, the biggest gainer on the Stoxx 600, after the luxury brand topped expectations for full-year profit and said it would cut 1,700 jobs.
FLSmidth rose 11.6 per cent after it surpassed first-quarter profit estimates and said it was negotiating with Pacific Avenue Capital Partners to divest its cement business.
A slew of economic data including gross domestic product and employment numbers for the euro zone is due through the remainder of the week. REUTERS
