European shares slip after China reforms underwhelm; tech leads losses (updated)

Tomra Systems ASA

05/03/2024 09:35

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        * 
      Euro zone business activity closer to recovery in Feb
    

        * 
      Dialysis providers up; investors focus on cardiac benefits
after
Ozempic data
    

        * 
      Bayer calls off break-up to tackle challenges for up to 3
years 
    

        * 
      STOXX 600 off 0.3%
    

  
 (Updated at 1650 GMT)
    By Khushi Singh and Ankika Biswas
       March 5 (Reuters) - 
    Europe's main index dipped on Tuesday, as mining shares
weakened with metal prices on a lack of substantial stimulus
from top consumer China, while investors awaited this week's
euro zone and U.S. economic data and an ECB policy decision.
  
    The pan-European STOXX 600  .STOXX  index shed 0.3%, a day
after hitting an all-time high, with technology  .SX8P  losing
1.6%, tracking weakness in its U.S. peers.
    A European Central Bank interest rate decision is scheduled
for Thursday, while euro zone retail sales and gross domestic
product reports and a slew of U.S. jobs data are due this week.
        "The only thing that would improve the situation from
here is either economic growth picking up, a tailwind for
stocks, and if the ECB's cutting rates," said Michael Field,
European market strategist at Morningstar.
  
        "What the ECB doesn't want to do is back themselves into
a corner whereby they promise to cut rates in June, and then you
see a backlash in markets."
  
    China's ambitious 2024 economic growth target of around 5%
missed some investors' expectations for stimulus measures.
        The basic resources sector  .SXPP  dropped 0.9% to a
four-month low.
        China-exposed luxury giants including Hermes  HRMS.PA 
and LVMH  LVMH.PA  each lost over 1%, with the broader sector
 .STXLUXP  slipping to a near two-week low.
        Utilities  .SX6P  jumped 1.8% as the battered
rate-sensitive sector benefited from a drop in bond yields.
    Among headlining stocks, Novo Nordisk  NOVOb.CO  dropped
2.5% after hitting a record high in early trade. A study showed
its widely used diabetes drug Ozempic delayed progression of
chronic kidney disease in diabetes patients, cutting risk of
major cardiac events and death by 24%.
        Dialysis firm Fresenius Medical  FMEG.DE  gained 11.5%,
along with its U.S. peers, after the kidney trial data
disappointed some investors.
        British equipment rental firm Ashtead  AHT.L  slumped
9.4% following a weak rental revenue growth outlook, while
Swedish car manufacturer Volvo Car  VOLCAR.ST  shed 7.6% after
lower-than-expected February sales.
        Bayer  BAYGn.DE  lost 7.6%. The company will hold off on
plans to break apart the group for up to three years, leaving
investors dubious about whether enough is being done to revive
its fortunes.
    Norwegian recycling machinery maker Tomra Systems  TOM.OL 
jumped 12.2%, with local analysts citing the European Union's
sustainable packaging deal to cut packaging waste.
        France's Thales  TCFP.PA  climbed 9.1% after unveiling
higher-than-expected 2023 sales, cash and profits.
        Investors also monitored data showing signs of recovery
in 
    euro zone business activity
     last month, while 
    producer prices
     in January fell much more than expected month-on-month.
  

 (Reporting by Khushi Singh and Ankika Biswas in Bengaluru;
Editing by Mrigank Dhaniwala, Sohini Goswami and Richard Chang)
 ((Khushi.Singh@thomsonreuters.com))