EUROPE’S Stoxx 600 closed slightly lower on Wednesday as energy stocks tracked lower crude oil prices, while Germany’s SAP slipped on news that the US is investigating the software developer over price-fixing claims.
The pan-European Stoxx 600 index closed 0.1 per cent lower after two sessions of gains.
SAP declined 2.4 per cent after Bloomberg News reported late on Tuesday that the US is investigating the company, US IT services provider Carahsoft Technology and others in a civil probe for allegedly conspiring to overcharge government agencies over the course of a decade.
The oil and gas sector led losses among the major Stoxx sectors, dropping 1.7 per cent. Crude oil prices fell more than 1 per cent as investors reassessed whether China’s latest stimulus plans could boost its economy and spur fuel demand in the world’s largest crude importer.
On Tuesday, China’s central bank rolled out its most significant stimulus package since the pandemic to lift the economy out of its deflationary slump. This sparked a rally in European equities, with French luxury stocks such as LVHM surging the most.
“This move by the PBOC was a surprise move and it happened at a time when particularly European cyclical stocks were very depressed,” said Frederique Carrier, head of investment strategy for RBC Wealth Management in the British Isles and Asia.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
“So you had the situation of a positive catalyst on a fairly over-sold lineup of sectors.”
China-exposed sectors such as automakers slipped 1.3 per cent after gaining more than 3 per cent in the last two sessions.
Sweden’s central bank cut its key interest rate to 3.25 per cent from 3.50 per cent, as expected, and said that if the inflation outlook remained favourable it could ease policy faster in the months ahead. The Swedish benchmark closed 0.7 per cent higher.
HSBC said it now expects the European Central Bank (ECB) to cut interest rates by 25 basis points at every meeting from October through to April next year given weakening economic data.
Among other notable stock moves, Valmet Oyj surged 11.7 per cent after the Finnish engineering company secured an order worth more than 1 billion euros (S$1.44 billion) in Brazil.
Bavarian Nordic gained 3.9 per cent after the Danish biotech firm said it had received a US$63 million order from the US government to produce additional bulk product and the final freeze-dried doses of its mpox and smallpox vaccine. REUTERS
