STOXX 600 falls on banks drag; tech contains losses on ASMI boost (updated)

Melexis NV

24/04/2024 10:18

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        * 
      Evotec slides after outlook misses expectations
    

        * 
      Roche drops on lower Q1 sales 
    

        * 
      Kering slumps on warning of H1 operating profit drop
    

        * 
      Temenos down after Hindenburg allegations impact Q1
    

  
 (Updates with closing prices)
    By Ankika Biswas and Johann M  Cherian
       April 24 (Reuters) - 
    Europe's benchmark stock index dropped on Wednesday as
financials sagged on disappointing earnings from Swedish lender
Handelsbanken, while technology stocks limited losses after ASM
International's strong forecast.
  
    The pan-continent STOXX 600 index  .STOXX  closed 0.5% lower
after initially rising to its highest in over a week.
        Bank shares  .SX7P  lost 1.2% after Handelsbanken
 SHBa.ST  tumbled 12.1% following a first-quarter net profit
miss, while SEB  SEBa.ST  shed 3.7% after posting
weaker-than-expected interest income in the first quarter.
        Financials  .SXFP  led sectoral declines, down 2%, with
Allfunds  ALLFG.AS  losing 11% after a report that the fund
manager abandoned talks over a potential sale.
        UBS  UBSG.S  fell 2.9% after the bank's executives
flagged major concerns about the Swiss government's plan to hit
it with tougher capital requirements.
    Tech stocks  .SX8P  rose 1.3% after ASM International
 ASMI.AS  jumped 11% as the wafer-processing equipment supplier
raised its second-quarter revenue forecast.
        Of the 34 STOXX 600 companies that have reported
first-quarter earnings, 61.8% exceeded estimates, compared with
a long-term average of 54%, LSEG data on Tuesday showed.
    Sentiment soured after Bundesbank President Joachim Nagel
noted euro zone inflation could remain stubborn, so a possible
interest rate cut by the European Central Bank might not be
followed by further policy easing.
    "The ECB may potentially cut by 25 basis points in June and
then hold for a month or two in order to assess its impact,"
said Daniela Hathorn, senior market analyst at Capital.com.
        "But out of the major central banks, the ECB looks the
most likely to cut."
  
        European stocks had a stellar run in the previous two
quarters, before pausing in April as geopolitical tensions and
concerns around a weak earnings season overshadowed optimism of
an imminent rate cut.
    Evotec  EVTG.DE  slumped 32% after the German biotech firm
announced a disappointing 2024 outlook.
    Drugmaker Roche  ROG.S  lost 3.3% after first-quarter sales
slipped 6% on the loss on COVID-related revenue. 
    Volvo Car  VOLCARb.ST  slumped 10.3% after the Swedish
automaker posted downbeat quarterly profits, while Kering
 PRTP.PA  fell 6.9% after the luxury goods maker forecast a 40%
to 45% plunge in first-half operating profit.
    Temenos  TEMN.S  dropped 8.7% after the Swiss banking
software group reported that short seller allegations from
February led to delays in client decision-making in the first
quarter.
        Swedish industrial manufacturer Atlas Copco  ATCOa.ST 
jumped 8.4% after surpassing estimates for first-quarter order
intake in every business division.
        Norwegian insurer Storebrand  STB.OL  climbed 7.5% after
it announced a first-quarter results beat and a share buyback
programme.

 (Reporting by Johann M Cherian and Ankika Biswas in Bengaluru;
Editing by Varun H K, Sherry Jacob-Phillips and Richard Chang)
 ((johann.mcherian@thomsonreuters.com))