European Stocks Are Little Changed as Software Retreats
European stocks were little changed, after their biggest jump in more than a week, as investors awaited Federal Reserve Chair Janet Yellen’s semi-annual testimony. U.S. index futures were also little changed and Asian shares rose.
Software AG lost 14 percent after lowering its operating-margin forecast. Draegerwerk AG dropped 10 percent after cutting its projection for sales growth. Gjensidige Forsikring ASA advanced 3.9 percent after saying profit climbed more than analysts had estimated.
The Stoxx Europe 600 Index slipped less than 0.1 percent to 339.66 at 8:08 a.m. in London. It advanced 0.9 percent yesterday after falling the most since March last week on concern over Portuguese banks. Standard & Poor’s 500 Index futures gained less than 0.1 percent, while the MSCI Asia Pacific Index climbed 0.4 percent.
Yellen delivers her semi-annual testimony to the Senate today and to the House Committee tomorrow. She said last month that the Fed will keep interest rates low for a considerable time after ending its asset-purchase program, even as it saw improvements in the economy and the labor market. In the U.K., Bank of England Governor Mark Carney testifies to the House of Commons Treasury Committee on the June Financial Stability Report.
A report at 8:30 a.m. in Washington may show U.S. retail sales rose 0.6 percent in June from a 0.3 percent increase in May, according to the median estimate of economists surveyed by Bloomberg. The New York Fed’s Empire manufacturing report probably fell this month, a separate release may show.
Other data at 11 a.m. Frankfurt time may show German investor confidence fell in July. The ZEW Center for European Economic Research will say its index of investor and analyst expectations dropped to 28.2 from 29.8 in June, according to economists in a Bloomberg survey. The gauge aims to predict economic developments six months in advance.
Software sank 14 percent to 21.32 euros after saying the margin on full-year operating profit may be as little as 26 percent. It had previously estimated 26.8 percent. The Germany software maker cited project delays.
Draegerwerk slid 10 percent to 70.43 euros. The German maker of medical equipment lowered its 2014 sales growth estimate to 2 percent to 4 percent from 3 percent to 6 percent. The company also forecast an annual margin on earnings before interest and taxes of 4.5 percent to 6.5 percent, citing a strong euro, reduced business from Russia and slower U.S. demand.
Gjensidige Forsikring advanced 3.9 percent to 121.20 kroner after the Norwegian insurer said pretax profit rose to 1.75 billion kroner in the second quarter from 1.08 million kroner a year earlier. Analysts on average had forecast 1.34 billion kroner. The company cited strong growth in premium and a fewer large losses.
Hennes & Mauritz AB rose 2 percent to 288.70 kronor. Europe’s second-biggest clothing retailer said sales increased 12 percent in June, exceeding the 9.4 percent gain that analysts had estimated in a SME Direkt survey.
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