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5 November 2019 12:30

European shares fall slightly after hitting highest level since 2015

European shares fell slightly on Tuesday, a day after hitting their highest levels since 2015, with a sales warning from Danish jewelry maker Pandora and a glum forecast from wind energy company Siemens Gamesa weighing on the benchmark index. 

The pan-European STOXX 600 index fell 0.03%, although declines were capped by hopes that a U.S.-China trade deal could be signed this month. 

Healthcare, utilities and real estate stocks, commonly considered defensives, recorded some of the biggest losses in early trading. 

The telecoms index fell 0.5%, the most among the major European sub-sectors, dragged down by a 1.6% fall in shares of Spanish telecoms group Telefonica after it posted quarterly profit below analysts’ forecast. 

A strong start to the European earnings season and hopes of a resolution in the economically damaging trade war have helped European shares log a strong start to the month, with the STOXX 600 now inching closer to a record high hit in April 2015. 

More than half of European companies have already reported results, with most of them beating significantly lowered analysts’ estimates. 

However on Tuesday, Pandora fell 12% and was on track for its worst day in more than a year as it warned of a steeper-than-expected fall in sales this year. The stock pulled the wider country index down 0.7%. 

German-Spanish company Siemens Gamesa tumbled 10.3% to its lowest level since January after lowering its forecast for 2020. 

In a bright spot, the chemicals sector rose 0.5% after strong earnings reports by Dutch specialty chemicals company DSM and German chemicals group Evonik Industries.
Tariff-hit miners rose after reports that China was pushing U.S. President Donald Trump to rollback more tariffs imposed in September as part of a “phase one” trade deal. 

Asian shares vaulted to six-month highs on Tuesday, surpassing their July peaks, as hopes that Washington may roll back some of the tariffs it has imposed on imports from China shored up optimism on the global economic outlook. 

MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.5% to reach levels last seen in early May, led by gains in Chinese shares. 

This article was compiled by BOV Asset Management Limited, a member of the BOV Group. BOV Asset Management, Premium Banking Centre (PBC), 475, Triq il-Kbira San Guzepp Santa Venera SVR 1011 - Malta
Email: [email protected] Internet address: BOV Asset Management is licensed by the MFSA.


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