European Shares Subdued As Eurozone Business Activity Slows

European stocks were subdued on Friday as investors react to mixed economic data from the region.

Eurozone bond yields dropped after preliminary data revealed business activity growth in Europe slowed in June.

The region’s flash composite Purchasing Managers’ Index dropped to 50.3 in June from 52.8 in the previous month.

Elsewhere, U.K. retail sales logged an unexpected growth in May as bank holidays and warm weather boosted demand for outdoor-related goods and summer clothing, official data showed.

Retail sales grew at a pace of 0.3 percent in May from April, the Office for National Statistics reported. This was in contrast to the expected fall of 0.2 percent.

Nonetheless, the pace of growth slowed from April’s 0.5 percent increase.

On a yearly basis, retail sales declined at a slower pace of 2.1 percent after a 3.4 percent fall in April. The decrease was also slower than economists’ forecast of 2.6 percent drop.

Separately, British consumer confidence rose for the fifth consecutive month in June to hit a 17-month high, a closely watched survey revealed.

Market research group GfK said its consumer sentiment index rose to -24 in June from -27 in May.

The pan European STOXX 600 was marginally higher at 455.07 but was on course for a loss of 2.6 percent for the week, its worst weekly performance in over three months on concerns about inflation and rising interest rates.

The German DAX dropped 0.6 percent, while France’s CAC 40 and the U.K.’s FTSE 100 were down around 0.2 percent each.

Italian oil major Eni S.p.A. fell 1.3 percent after agreeing to acquire private equity-backed Neptune Energy for $4.9bn in the largest cash deal in the European oil and gas sector for almost a decade.

GSK jumped more than 6 percent in London after settling a Zantac suit in the U.S. to avoid a protracted legal fight.

Housebuilders fell across the board amid soaring mortgage costs. Taylor Wimpey dropped 2.1 percent, Persimmon lost 3 percent and Barratt Developments shed 2 percent.

Capgemini SE shares rose half a percent in Paris. The IT services and consulting company has signed a share purchase agreement to acquire BTC Corp., a Japanese cloud and digital services provider for an undisclosed amount.

Siemens Energy shares plummeted over 31 percent. The German company, which supplies equipment and services to the power sector, withdrew its profit guidance for fiscal year 2023 due to Siemens Gamesa citing a substantial increase in failure rates of wind turbine components.

Industrial engineering and steel production company Thyssenkrupp fell nearly 2 percent on reports that its Nucera hydrogen unit is seeking to raise as much as €566 million ($615 million) in an initial public offering.

Source: Read Full Article