European Stocks Are Little Changed as Peugeot Shares Slip

European stocks were little changed, with the Stoxx Europe 600 Index posting a second weekly drop, as investors awaited next week’s Federal Reserve meeting, and as gains in AstraZeneca Plc (AZN) offset PSA Peugeot (UG) Citroen’s slide.

AstraZeneca rose to a six-month high after a diabetes pill from the company and Bristol-Myers Squibb Co. won the backing of a U.S. advisory panel. Peugeot slumped the most in five years as General Motors Co. said it is selling its entire stake in the French carmaker. RSA Insurance Group Plc plunged 7.2 percent after its Chief Executive Officer Simon Lee resigned as an investigation into accounting practices at its Irish unit forced the company to increase reserves.

The Stoxx 600 fell 0.2 percent to 309.75 at the close of trading. The regional benchmark has retreated 2.1 percent this week as U.S. economic data fueled speculation the Fed could slow the pace of bond buying sooner than forecast.

“The debate about the beginning of the Fed tapering at its Dec. 17-18 meeting hangs over markets like the sword of Damocles,” said Martin Schlatter, a fund manager at Swiss Rock Asset Management AG in Zurich, which oversees about $1 billion. “We don’t expect any actions yet. Therefore we believe the current weakness should be a buying opportunity.”

About 34 percent of economists surveyed on Dec. 6 by Bloomberg predicted that the U.S. central bank may reduce its $85 billion of monthly bond purchases at its Dec. 17-18 meeting, up from 17 percent in a Nov. 8 poll.

National Indexes

National benchmark indexes declined in 12 of the 18 western-European markets today. France’s CAC 40 lost 0.2 percent, Germany’s DAX slipped 0.1 percent and the U.K.’s FTSE 100 dropped 0.1 percent.

AstraZeneca Plc gained 1.8 percent to 3,518.5 pence. The benefits of the new diabetes drug outweigh a potential higher risk of bladder cancer and liver toxicity, an advisory panel to the Food and Drug Administration said. The FDA is expected to decide by Jan. 11 whether to approve the treatment, known as dapagliflozin.

ARM Holdings Plc (ARM) climbed 3 percent to 1,001 pence. The U.K. chip designer announced the acquisition of Geomerics, a provider of lighting technology for the gaming and entertainment industry, without giving financial details.

Separately, Google Inc. may design its own server processors using technology from ARM, whose products power Apple Inc.’s iPhones, according to a person familiar with the matter.

Home Retail Group Plc (HOME) added 2.2 percent to 189.7 pence. Deutsche Bank AG raised the owner of the Argos chain to buy from hold, citing a “more buoyant consumer atmosphere.”

Hays Rises

Hays Plc climbed 2.1 percent to 118.8 pence. Morgan Stanley initiated coverage of the recruitment company with an overweight rating, the equivalent of buy, saying its exposure to markets where demand for temporary workers is strong will boost profit next year.

Syngenta AG (SYNN), the world’s biggest maker of crop chemicals, advanced 1.8 percent to 341.70 Swiss francs as Vontobel Holding AG upgraded its recommendation on the stock to buy from hold and raised the price estimate by 7.8 percent to 415 francs. Vontobel forecast “double-digit” earnings growth for 2014-2015 as Syngenta cuts costs and increases its market share.

Peugeot declined 12 percent to 9.34 euros. General Motors, the U.S. automaker that acquired a stake in Peugeot last year, is selling its entire 7 percent holding -- 24.8 million shares - - through a private placement to institutional investors. GM is offering the shares to money managers for 10 euros to 10.25 euros apiece, according to a person with knowledge of the transaction who wasn’t authorized to speak publicly.

Lower Savings

GM’s 320 million-euro ($440 million) investment in the Paris-based automaker was part of an alliance aimed at delivering savings through joint purchasing and product development. Co-operation has been scaled back and Peugeot said yesterday that savings will be 40 percent less than originally announced.

RSA Insurance (RSA) plunged 7.2 percent to 92.5 pence, its lowest price in more than eight years. The London-based insurer added an additional 130 million pounds ($212 million) to its Irish reserves and forecast a further reduction in 2013 earnings. Chairman Martin Scicluna will lead the company until a new CEO is appointed.

Delta Lloyd NV (DL) dropped 3 percent to 17.14 euros. Goldman Sachs Group Inc. cut its rating on the biggest Dutch provider of group life insurance to neutral from buy, citing the stock’s rally. The shares have gained 39 percent this year, compared with the Stoxx Insurance 600 Index’s 20 percent increase.

To contact the reporter on this story: Corinne Gretler in Zurich at cgretler1@bloomberg.net

To contact the editor responsible for this story: Cecile Vannucci at cvannucci1@bloomberg.net

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