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Europe: Stocks slip after recent surge, all eyes on Trump-Biden debate
[BENGALURU] European stocks slipped on Tuesday after solid gains in the previous session, with banks, energy and insurance sectors sliding as coronavirus cases mounted globally.
Investors were mostly in a wait-and-see mode as US Democratic presidential nominee Joe Biden and President Donald Trump prepared for their first debate, five weeks before the presidential election.
The 90-minute showdown will begin at 0100 GMT on Wednesday, with investors seeking hints on policy outlook.
The pan-European Stoxx 600 closed down 0.5 per cent, in line with tepid moves across global markets also watching for progress in talks on more US fiscal stimulus.
Banks handed back some of the previous session's 5.6 per cent gain, while other economically sensitive sectors like insurers and energy fell more than 1.5 per cent as the global Covid-19 death toll crossed 1 million, a Reuters tally showed.
Still, many investors counted on continued stimulus from central banks and governments to prop up the global economy reeling from the health crisis.
"Our stance on equities is still constructive in the medium-term, even if it's bumpy ride due to risks including Brexit, US-China trade friction and uncertainty around the US election," said Michele Morganti, equity strategist at Generali Insurance Asset Management.
"We feel that recovery is still in place and cyclicals will continue to find favour, and that will help the undervalued regions like Europe versus US."
Solid gains for European markets on Monday helped the Stoxx 600 turn positive for the third quarter, while the benchmark is on course to end September with a more than 1 per cent drop, its biggest since a near 15 per cent decline in March, when pandemic fears hit a peak.
Sensor specialist AMS jumped 6.6 per cent to the top of Stoxx 600, with traders pointing to supportive news about lighting group Osram, which it recently took over.
British plumbing parts distributor Ferguson gained 6.0 per cent as it restored its dividend after a series of cost-reduction measures and resilience in its main US business helped it report a 4.1 per cent rise in annual profit.
British baker Greggs slid 8.1per cent as it cautioned that the outlook was uncertain because of the pandemic and it would have to cut staff jobs and hours.
Finnish valves maker Neles gained 2.2 per cent after Valmet approached the company with a merger proposal, challenging a US$2 billion bid that Neles' board recommended from Swedish engineering group Alfa Laval. Valmet shares dropped 4.9 per cent.