European shares lower ahead of May speech, weighed by miners and carmakers

Chocoladefabriken Lindt & Spruengli AG

17/01/2017 09:55

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    By Helen Reid 
    LONDON, Jan 17 (Reuters) - European shares were dragged 
lower by miners and carmakers on Tuesday, as markets awaited 
details of Britain's Brexit position in a late morning speech by 
Prime Minister Theresa May. 
    The pan-European STOXX  .STOXX  index was down 0.4 percent, 
and Britain's blue-chip FTSE  .FTSE  extended its losses, down 
0.3 percent. 
    Uncertainty about Britain heading for a "hard" Brexit was 
reinforced over the past week, pushing the pound to some of the 
lowest levels against the U.S. dollar seen in more than three 
decades. 
     "I get the sense we are at last entering the territory we 
thought we would be in in June, and the period of 'business as 
usual' is coming to an end," said Peter Dixon, economist at 
Commerzbank. 
    There were some chinks of light in the pan-European index. 
Airline carrier Lufthansa  LHAG.DE  soared to the top of 
Germany's DAX after an Italian paper reported Saudi telecoms 
company Etihad was interested in taking an equity stake in it. 
    Swiss chocolate maker Lindt  LISN.S  saw its shares gain 5.2 
percent after it succeeded in increasing sales in Europe, Japan 
and Brazil, facing down headwinds of low consumer confidence. 
 urn:newsml:reuters.com:*:nL5N1F70UA 
    Basic resources stocks were the biggest sectoral fallers, 
with the basic resources index  .SXPP  down 1.2 percent, dragged 
down by lower metals prices caused by a stronger dollar with 
markets spooked over Brexit.   
    Anglo American  AAL.L , BHP Billiton  BLT.L  and Antofagasta 
 ANTO.L  were down 1.6 to 1.8 percent. Arcelormittal  ISPA.AS  
was the worst-performing stock in the CAC 40.  
    Shares in German fashion retailer Zalando  ZALG.DE  slumped 
6.5 percent after its sales growth disappointed expectations. 
 urn:newsml:reuters.com:*:nL5N1F716E 
    Mediaset  MS.MI  was down 3.8 percent after a report, 
without citing sources, said a potential takeover offer for the 
Italian broadcaster by France's Vivendi  VIV.PA  would not be 
'judicially acceptable' for Italian communications authority 
AGCOM.  urn:newsml:reuters.com:*:nL5N1F71EN 
    Carmakers took some strain again as U.S. President-elect 
Donald Trump's threat to slap import tariffs on cars made in 
Mexico rippled through the market.  urn:newsml:reuters.com:*:nL5N1F61VQ 
    Peugeot  PEUP.PA  was a top faller in France's CAC index, 
down 1.6 percent, while German carmakers Volkswagen  VOWG_p.DE , 
Daimler  DAIGn.DE  and BMW  BMWG.DE  continued to weigh on the 
DAX. 
    Italy's blue-chip FTSE MIB  .FTMIB  was the only major 
European index in positive territory, boosted by an upswing in 
banks Banco BPM  BAMI.MI , UBI Banca  UBI.MI , BPER Banca 
 EMII.MI  and Unicredit  CRDI.MI . 
    "Since the Italian referendum, market repair has 
accelerated: while the stock of non-performing loans at banks is 
likely to take time to revert to average levels, a series of 
announcements by banks should be positive steps towards market 
repair," a Goldman Sachs note said. 
 
 (Reporting by Helen Reid, Editing by Vikram Subhedar/Jeremy 
Gaunt) 
 ((Helen.Reid@thomsonreuters.com; +44 20 7542 7748;)) 
 
Keywords: EUROPE STOCKS/