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Europe: Shares slip back; Novozymes slumps on weak results
[LONDON] European shares fell on Thursday, with weak corporate results weighing on enzyme company Novozymes and Deutsche Post even as UK stocks outperformed on receding rate-hike fears.
The pan-European FTSEurofirst 300 index, which rose 1.3 per cent in the previous session, closed down 0.8 per cent at 1,589.38 points. The euro zone's blue-chip Euro STOXX 50 index declined by 0.2 per cent.
Novozymes slid by around 13 per cent after reporting second-quarter earnings below expectations. Deutsche Post's shares also fell after cutting its 2015 profit outlook.
Weak oil prices also weighed on energy stocks.
However, Belgian financial company KBC rose 3 per cent after it posted higher profits. Reinsurer Munich Re firmed 1.5 per cent on an improved outlook.
The rise in Munich Re enabled Germany's DAX to slightly outperform the region, though Deutsche Post put a drag on the index when it lowered its profit target. Britain's FTSE was a big outperformer, down only 0.1 per cent, after a slew of Bank of England data showed the central bank was in no hurry to raise interest rates.
Greek stocks also recovered after slumping for the past three days, although many investors have cut their exposure to the debt-ridden country. "We retain our more favourable view on European equities," Oliver Wallin, investment director at Octopus, said in a note to clients. "However, we reduced European holdings in July as we await opportunities to buy back into the market when the situation in Greece becomes clearer." According to data from Thomson Reuters StarMine, 59 per cent of companies on the European STOXX 600 index have met or beaten market expectations for their results this quarter.
Along with the robust corporate results, economic stimulus measures from the European Central Bank have also propped up European stock markets this year, enabling them to shrug off lingering concerns over Greece's debt problems.