European shares end week in the red as earnings disappoint

Reuters

European shares end week in the red as earnings disappoint

9:18 sáng giờ GMT, 25 Tháng 10 2024

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Mercedes car earnings plunge as China shuns luxury

Electrolux slides on US woes, Chinese competition

Signify shares soar as largely in-line Q3 provides relief

Updated at 1603 GMT

By Paolo Laudani, Ankika Biswas and Johann M Cherian

Oct 25 (Reuters) -Europe's main stock index closed Friday's choppy session flat and notchedweekly losses, asa handful of weak corporate earnings from auto-related companies such as Mercedes-Benz and Valeo and appliances-maker Electrolux dented investorsentiment.

The pan-European STOXX 600 .STOXX closed flat for the second straight day and logged itsfirst weekly loss in three, with real estate stocks <.SX86P>among the worst-hit sectors for the week.

Auto stocks .SXAP also ended the session on a muted note, withGermany's Mercedes-Benz MBGn.DE dropping 1% after third-quarter earnings in core car division missed estimates by a wide margin.

Valeo VLOF.PA added to the sector's woes, tanking9.5% as the automotive supplier cut its annual sales guidance for the second time this year.

Electrolux ELUXb.ST slumped 14.6% to the bottom of the main index aftermissing third-quarter earnings expectations on continuing U.S. losses and rising competition from China.

Of the STOXX 600 companies that have reported third-quarter earnings, 35.3% beat estimates versus the typical beat rate of 54%, LSEG data showed earlier this week.

Equities have struggled of late, with the STOXX 600 losing momentum after hitting record highs multiple times this year, as investors navigate corporate earnings, the global rate-cut trajectory and the upcoming U.S. election.

Aiding some relief on the day, asurvey showed German business morale improved more than expected in October, offering hope for some respite towards the year-end. Traders now brace for third-quarter gross domestic product data due next week.

"Even if growth this year turns out to be slightly negative, we believe the current state of the economy would be better described as stagnation than a recession. The big picture is that Germany's economy has not grown for another year and remains stuck at pre-pandemic levels," Robin Winkler, chief economist at Deutsche Bank, wrote.

In bright spots,lights-maker Signify LIGHT.AS jumped 10% and topped the STOXX as a largely in-line quarterly report and expectations of cost-cutting measures provided relief.

Sanofi SASY.PA added 2.5% and topped the French CAC 40 index .FCHI after the drugmakerposted stronger earnings growth than analysts had expected in the third quarter, boosted by an earlier-than-anticipated start to the vaccination season.

Hexagon HEXAb.ST was up 3.8% after the Swedish industrial technology group said it is mulling a spin-off of its Asset Lifecycle Intelligence business.

British lender NatWest NWG.L climbed 3.8% after raising its income forecast for 2024.

Auto stocks sputter https://reut.rs/3YN55AB

Reporting by Paolo Laudani in Gdansk and Ankika Biswas in Bengaluru; Editing by Varun H K, Mrigank Dhaniwala and Maju Samuel

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