European Stocks Are Little Changed; SAP Shares Tumble

European stocks were little changed as concern that debt-ceiling talks will harm the U.S. economy and a report showing weaker-than-forecast German growth offset Spain’s better-than-targeted sale of debt.

IG Group Holdings Plc (IGG) slipped 1.1 percent after saying first-half net trading revenue fell. SAP AG (SAP) sank the most in six months after reporting earnings that trailed estimates. Air Liquide SA dropped 1 percent after Bank of America Corp. cut its recommendation on the stock. Hennes & Mauritz AB (HMB) advanced 3.6 percent after posting sales that beat analyst forecasts.

The Stoxx Europe 600 Index (SXXP) lost less than 0.1 percent to 285.97 at the close of trading. The measure has still gained 2.3 percent since the start of the year after U.S. lawmakers agreed on a budget, avoiding tax increases and spending cuts that threatened to push the world’s biggest economy into a recession.

“We had a relief rally after the fiscal cliff was pushed out,” Lucy MacDonald, chief investment officer for equities at Allianz Global Investors in London, which oversees $401 billion, said in a Bloomberg Television interview. “Now the focus will go back on the fiscal cliff and the debt ceiling. That can be a catalyst for a pause.”

National benchmark indexes fell in 11 of the 18 western European markets. France’s CAC 40 lost 0.3 percent and Germany’s DAX sank 0.7 percent. The FTSE 100 added 0.2 percent.

The volume of shares changing hands on the Stoxx 600 was 17 percent higher than the average of the last 30 days, according to data compiled by Bloomberg.

Obama Warns

With as little as a month until the U.S. runs out of money to pay its bills, President Barack Obama warned Republicans in Congress not to use the need for a debt-limit increase to force through new spending cuts.

U.S. Treasury Secretary Timothy F. Geithner said so-called extraordinary measures he’s taking to avoid breaching the debt ceiling would work only until mid-February to early March and warned that failure by Congress to raise the limit could “impose severe economic hardship” on the country.

Since 1960, Congress has raised or revised the limit 79 times, including 49 times under Republican presidents, according to the Treasury Department.

Germany’s economy probably shrank in the final quarter of 2012. Gross domestic product may have dropped as much as 0.5 percent from the third quarter, the Federal Statistics Office in Wiesbaden said today in a preliminary estimate. In 2012, growth slowed to 0.7 percent from 3 percent the previous year, it said. Economists forecast expansion of 0.8 percent for 2012, according to the median of 28 estimates in a Bloomberg News survey.

Spanish Auction

Spain sold 5.75 billion euros ($7.7 billion) of bills today. The Treasury, which set an upper goal for the sale of 5.5 billion euros, sold 12-month bills at an average 1.472 percent, compared with 2.556 percent on Dec. 11. It sold 18-month debt at 1.687 percent, down from 2.778 percent.

IG Group, owner of the IG Index financial spread-betting brand, slipped 1.1 percent to 462.5 pence. The company said first-half net trading revenue fell 14 percent to 169 million pounds ($271.8 million) and pretax profit slid 21 percent to 81.1 million pounds.

SAP sank 3.9 percent to 58.70 euros, the most since July 6. The biggest maker of business-management software reported earnings trailing analysts’ estimates as it increased spending and growth in the Americas slowed. Fourth-quarter operating profit excluding some items rose about 10 percent to 1.96 billion euros, compared with analyst estimates for 2 billion euros.

Air Liquide

Air Liquide (AI), a maker of industrial gases, fell 1 percent to 92.15 euros after Bank of America’s Merrill Lynch unit cut its recommendation to underperform from neutral, saying that the “risk/reward” at the shares’ current levels isn’t attractive.

Orion Oyj (ORNBV) tumbled 4.2 percent to 21 euros. The Finnish drug maker dropped after Jefferies International Ltd. said the stock was overvalued following a 42 percent climb during the second half of last year.

H&M jumped 3.6 percent to 228.20 kronor. Europe’s second- largest clothing retailer reported an increase in sales that beat analysts’ estimates.

Burberry Group Plc (BRBY) advanced 4.6 percent to 1,386 pence. The U.K.’s largest luxury-goods company said third-quarter revenue increased 7 percent to 613 million pounds, exceeding the 601.4 million-pound average of nine analysts’ estimates compiled by Bloomberg.

To contact the reporter on this story: Adria Cimino in Paris at acimino1@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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