European stocks were little changed, with the Stoxx Europe 600 Index advancing for a seventh week, as a better-than-expected report on U.S. business activity offset consumer-confidence data that missed forecasts.
Societe Generale SA slipped 2.2 percent after Les Echos reported that the French bank’s Russian unit posted a decline in first-quarter profit. BNP Paribas SA fell 2.4 percent as a person familiar with the matter said U.S. authorities are seeking more than $10 billion from the bank to settle investigations into dealings with sanctioned countries. Rio Tinto Group and BHP Billiton Ltd. slid as a gauge of commodity producers declined the most on the Stoxx 600.
The Stoxx 600 fell 0.1 percent to 344.24 at the close of trading. The benchmark gauge climbed 0.7 percent this week, capping its longest streak of weekly gains since 2012. It has risen 1.9 percent in May as European Central Bank President Mario Draghi pledged to ease monetary policy in June if necessary.
“A generally positive week for global equities has been achieved despite light volumes on limited data,” said Richard Hunter, head of equities at Hargreaves Lansdown Plc in London. “Investors have been searching for the next direct catalyst, but in the meantime have been lightened by an improving U.S. economy and, in particular, on hopes that next week will herald some fresh monetary stimulus from the European Central Bank.”
Draghi said this month he’s “comfortable” to act in June to expand the central bank’s easing policy. The bank next announces its monetary policy decision on June 5. ECB Executive Board member Yves Mersch said in Tokyo on May 28 that the central bank is working on a package of measures to fuel price growth and stimulate the economy, which could include a negative deposit rate for the first time.
Business activity in the Chicago area unexpectedly increased to a seven-month high in May as orders accelerated. The Institute for Supply Management-Chicago Inc.’s business barometer rose to 65.5 this month from 63 in April. That beat the median forecast in a Bloomberg survey for a drop to 61. Readings greater than 50 signal growth.
U.S. consumer confidence fell in May more than forecast. The Thomson Reuters/University of Michigan final index of sentiment dropped to 81.9 in May from 84.1 in April. The median projection in a Bloomberg survey of economists called for 82.5 after an initial May reading of 81.8.
National benchmark indexes declined in eight of 17 western European markets trading today. Copenhagen’s bourse was closed for a holiday. France’s CAC 40 fell 0.2 percent, Germany’s DAX added less than 0.1 percent, and the U.K.’s FTSE 100 dropped 0.4 percent.
Societe Generale fell 2.2 percent to 42.27 euros. OAO Rosbank, the Moscow-based bank in which the French lender has a majority stake, posted first-quarter operating profit of 7 million euros ($9.5 million), down from 61 million euros in the fourth quarter. Rosbank’s net cost of risk rose by 150 percent in the first quarter, Les Echos reported, without saying where it got the information.
BNP Paribas lost 2.4 percent to 51.37 euros. A final settlement of federal and state investigations is probably weeks away, said the person, who asked not to be named because the talks aren’t public. The bank said in April that it might need to pay far more than the $1.1 billion it had already set aside.
Rio Tinto and BHP Billiton, the world’s two largest commodity producers, retreated 4.1 percent to 3,057 pence, and 3.7 percent to 1,868 pence, respectively. Fresnillo Plc, which mines precious metals, dropped 3.5 percent to 806 pence. A gauge of commodity producers on the Stoxx 600 fell 3 percent.
Fenner Plc tumbled 10 percent to 350 pence, for its biggest drop since 2009. The maker of conveyor belts said underlying pretax profit could be 10 percent to 15 percent lower than analysts’ estimates of 77.6 million pounds because of deteriorating trading conditions in the U.S. coal industry.
Salamander Energy Plc jumped 7.6 percent to 148.3 pence. Cia Espanola de Petroleos SA is considering a 700 million euro ($953 million) bid for the U.K. oil explorer, according to an Expansion report that cited unnamed bankers.