EUROPE’S Stoxx 600 settled lower on Wednesday, with tech and luxury stocks hurt by disappointing results from industry heavyweights ASML and LVMH, while caution prevailed ahead of the European Central Bank’s policy decision.
The continent-wide Stoxx 600 index fell 0.2 per cent, retreating further from the over two-week high hit early on Tuesday. The euro zone blue chip index closed at more than a three-week low.
ASML, the world’s biggest chipmaking equipment manufacturer, shed another 5.1 per cent to hit a 10-month low, dragging the tech index down 1.5 per cent to a one-month low. Its weak 2025 sales forecast on Tuesday sparked its steepest one-day decline in nearly three decades.
Jochen Stanzl, chief market analyst at CMC Markets, said ASML’s disappointing results might be due to cost cuts by its customers such as Intel and that in a few months, fresh orders could lift the stock.
The luxury sector also faltered as France’s LVMH dropped 3.7 per cent, the stock’s biggest one-day drop in over one month, after the company reported weaker third-quarter sales.
The French CAC 40 index underperformed most major European bourses with a 0.4 per cent decline. Peers Gucci-owner Kering, Hermes and Richemont fell between 0.8 per cent and 1.3 per cent. The broader luxury and personal and household goods indexes each shed over 1.3 per cent.
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Both indexes have underperformed Stoxx 600 so far this year. China-exposed firms have grappled with dwindling sales in the world’s second-biggest economy, with sentiment getting a brief boost from the latest stimulus measures.
Shoemaker Adidas fell 6.3 per cent despite raising its full-year sales and profit guidance.
Spain’s benchmark closed at its highest since January 2010, but Germany’s DAX index retreated further by 0.1 per cent from Tuesday’s record high.
“The probability for (the DAX) to continue going up is higher because given the fact that there are a lot of export oriented companies in the DAX comparable to global US companies,” Stanzl said.
Market participants expect the ECB to cut rates by another 25 basis points on Thursday, which could boost stocks.
Travel and leisure stocks rose 1.6 per cent to top sectoral charts, boosted by Whitbread’s 6 per cent gain after the Premier Inn owner said bookings were picking up for the holiday season.
Among others, Just Eat Takeaway lost 8.8 per cent after the food delivery company missed expectations for third-quarter gross transaction value.
Tecan dropped 14.5 per cent to the bottom of the Stoxx index after the Swiss life science equipment maker cut its annual outlook.
Teleperformance topped the Stoxx index with a 11.2 per cent rise after Kepler Cheuvreux upgraded the office services and call centre company’s stock to “buy” from “hold.” REUTERS
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Publish date : 2024-10-16 15:16:00
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