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Frankfurt - European shares declined a third day as energy and commodity producers slid, while investors assessed earnings and growth prospects following worse-than-expected German business-confidence data.
Rio Tinto and BHP Billiton [JSE:BIL] fell at least 3.4%, leading miners to the biggest decline of the 19 industry groups on the Stoxx Europe 600 Index as base metals retreated. BP dragged oil companies lower as crude slid.
Automakers dropped, with Volkswagen losing 2.4% and Daimler falling 2.1%. Royal Philips slid 4.5% after saying it is considering an initial public offering of its lighting business, as it reported better-than-estimated quarterly profit.
The Stoxx 600 slipped 0.8% to 345.54 at 10:22. European shares fell on Friday, trimming a second weekly advance, with carmakers leading declines amid fresh concerns over the extent and fallout of emissions cheating.
German business confidence unexpectedly deteriorated in April, according to the Munich-based Ifo institute, which reported today that it’s key index fell to 106.6 from 106.7 in March. Economists had forecast 107.1.
The equity benchmark surged 15% from a February low to the end of last week as commodity and energy producers rallied.
The gains have come even as analysts slashed their profit estimates for the region’s companies. They now predict an earnings decline in 2016 for Stoxx 600 firms, reversing calls for growth at the start of the year.
As well as earnings, investors will look to data including consumer prices and growth this week for signs of the health of the euro-area economy and the efficacy of European Central Bank stimulus measures.
Zodiac Aerospace SA fell 1.9% as Reuters cited an unnamed person as saying that an offer for the company from Safran SA was “not on the agenda.” Safran SA rose 1.3%.
