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Madrid - European shares posted their first back-to-back losses since mid-August as investors continued to pull money from the region’s equity funds amid concern over the economic recovery.
The Stoxx Europe 600 Index slipped 0.3% at 11:40, taking its weekly slide to 0.6%, the first in three weeks. While most industry groups fell, banks rose for a third day, set to close at a two-month high.
After rising to their highest prices since April, European shares have once again lost momentum, with US services data indicating this week the weakest expansion in six years and European Central Bank President Mario Draghi downplaying the need for more stimulus.
The Stoxx 600 has lost 4.8% this year amid concern over the economic recovery, and a Bank of America report showed fund managers withdrew money from the region’s equity funds for a 31st straight week.
“People were expecting the ECB to do more,” said Pierre Mouton, who helps oversee about $8.5bn as a fund manager at Notz, Stucki & Cie. in Geneva. “After a strong rally in the past two months, we have more volatility going forward, with the Italian referendum and the US election, so there are many things lingering that are making people nervous after the ECB meeting.”
The Stoxx 600 rebounded 14% from the June low that followed the UK secession vote through Monday. Since then, though, investors have started to question the rally amid intensifying speculation about the next Federal Reserve interest-rate increase, while eurozone economic data have began to miss forecasts again.
Almost all western-European stock markets fell on Friday. The UK’s FTSE 100 Index declined 0.3%. Germany’s DAX Index, which earlier this week erased its annual drop, slipped 0.1%, and France’s CAC 40 Index was little changed.
Lenders, the worst-performing industry group this year, climbed, led by gains in Deutsche Bank. The German firm advanced 5.1% after a report that it’s nearing an agreement with the US Department of Justice to settle a long-running investigation into the sale of residential mortgage-backed securities. Royal Bank of Scotland, Credit Suisse and Societe Generale rose more than 2%.
Among stocks moving on corporate news, Greene King dropped 4% after the British pub owner said there could be tougher trading
ahead. Burberry slid 2.3% after a report that it cut
prices in Hong Kong and China and as Goldman Sachs removed it
from its list of shares to focus on. J D Wetherspoon advanced
percent after the UK pub chain reported adjusted pretax earnings that
beat estimates.
