European Shares Inch Lower On Growth Worries

Australian dollars in Sydney, Friday, Jan. 15, 2016. (AAP Image/Joel Carrett) NO ARCHIVING

European stocks fell from five-week highs on Tuesday as a second wave of coronavirus cases in Europe raised questions about the sustainability of economic recovery.

German investor sentiment fell by more than expected in October, raising uncertainty about the outlook for Europe’s largest economy.

Meanwhile, Johnson & Johnson’s move to pause its Covid-19 clinical trials also raised doubts about the timeline of a vaccine.

The pan European Stoxx 600 slipped 0.1 percent to 372.56, snapping a three-day winning streak. The German DAX and France’s CAC 40 index fell around 0.2 percent while the U.K.’s FTSE 100 was down 0.3 percent.

Gerresheimer, a global partner to the pharma and healthcare industry, slumped 4.7 percent.

Pharma firm MorphoSYS plunged 9.3 percent after announcing a €325m bond offering.

Evotec shares climbed 2.3 percent. Mubadala Investment Company, a sovereign investor, said it will invest 200 million euros to subscribe for about 5.6 percent of outstanding Evotec shares.

British clothing retailer French Connection Group plunged 19 percent after it reported a much widened pretax loss for the first half of fiscal 2021.

Utility SSE surged nearly 4 percent after it agreed to sell its 50 percent stake in Ferrybridge and Skelton Grange multi-fuel assets in a £995 million cash deal.

EasyJet declined 1.5 percent, IAG lost 2.6 percent and engine maker Rolls-Royce plummeted 5.3 percent as the U.K. government imposed new Covid-19 restrictions.

Unibail-Rodamco-Westfield rallied 3.3 percent. The commercial real estate company has agreed to sell its SHiFT office building to a consortium of French institutional investors for 620 million euros.

Nestle SA was modestly higher. The company said, in an update on results of tender offer for Aimmune Therapeutics, that about 43.44 million Aimmune shares were validly tendered.

Aerospace and defense company Airbus tumbled 3.2 percent after JPMorgan cut its rating on the company’s stock to “underweight”.

In economic releases, German consumer prices declined 0.2 percent yearly in September, after remaining unchanged in August, as estimated earlier, final data from Destatits revealed. Prices fell for the second time since the beginning of the year.

The ZEW economic sentiment index for Germany fell to 56.1 from 77.4 points the previous month.

The U.K. ILO jobless rate rose by 0.4 percentage points from the preceding quarter to 4.5 percent in three months to August, official data showed.

Total retail sales in the U.K. grew 5.6 percent annually in September versus a 0.6 percent drop a year ago, the British Retail Consortium said. This was the fastest growth since December 2009, excluding Easter distortions.

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