Eurostoxx 50:2,795.07 (–6.92) Frankfurt DAX:7,278.10 (–7.32) Paris CAC:3,871.37 (–5.70)
STOCKS ACROSS Europe lost ground yesterday as Royal Philips Electronics tumbled.
Philips plunged the most in more than two years after the world’s biggest maker of patient-monitoring systems forecast “low single-digit” sales growth at its lighting business.
“Recession fears are coming back into the market and problems around sovereign debt also bring the market in a bad shape,” said Philipp Musil of Semper Constantia Privatbank in Vienna.
“Investors are uncertain of what is coming next.
“We’re still quite optimistic and we’re thinking it’s a normal consolidation, but it can change quite fast if we get more confirmation of a recession,” he said.
Greek prime minister George Papandreou won a vote of confidence overnight. He still needs parliamentary approval next week for a €78 billion package of budget cuts to stave off default.
Philips sank 8.5 per cent to €16.45, its biggest drop since March 2009. The company said it will need to deepen cost cuts to arrest deteriorating consumer demand for lighting and consumer electronics.
Electrolux, the world’s second-biggest appliance maker, fell 2.9 per cent to 148.50 kronor.
Merck lost 2.8 per cent to €73.01 as the drug maker said it will no longer seek approval for the experimental Cladribine medicine after regulators said it would have to start a new clinical trial program.
Hennes and Mauritz fell 2.1 per cent to 210.20 kronor as the clothing retailer said the rising cost of making garments led to an 18 per cent decline in second-quarter profit, missing analysts’ estimates.
Remy Cointreau slipped 1.4 per cent to €56.18, the first retreat in four days, as the maker of Remy Martin cognac was downgraded at JPMorgan Chase.
Dixons Retail surged 8.3 per cent to 16.63p, ending the longest falling streak in three months. The London-based Times reported that Best Buy may be interesting in bidding for its UK competitor.
Renault, which owns a 43 per cent stake in Nissan Motor, rose 3.4 per cent to €39.35.
Petropavlovsk rose 1.6 per cent to 741p as the producer of gold in Russia was raised to “buy” from “neutral” at BofA Merrill Lynch. – (Bloomberg)
