European Stocks Retreat as Miners Slide, German Data Disappoint

  • Anglo American leads commodity producers lower as metals drop
  • Philips slides amid prospects of IPO for lighting division

European Shares Suffer Third Straight Day of Losses

European shares declined for a third day as energy and commodity producers slid, while investors assessed growth prospects following worse-than-expected German business-confidence data.

Anglo American Plc and BHP Billiton Ltd. fell at least 5.8 percent, leading miners to the biggest decline of the 19 industry groups on the Stoxx Europe 600 Index, as base metals retreated. Royal Dutch Shell Plc lost 2.2 percent, dragging oil companies lower as crude slid. Royal Philips NV dropped 4.3 percent after saying it is considering an initial public offering of its lighting business.

The Stoxx 600 slipped 0.5 percent to 346.68 at the close of trading, paring earlier declines of as much as 0.9 percent. Germany’s benchmark DAX Index slid 0.8 percent after a report showed business confidence in Europe’s biggest economy unexpectedly deteriorated in April.

“Whether you pin it on oil, or earnings or company-specific news, it doesn’t really matter,” said Frances Hudson, an Edinburgh-based global thematic strategist at Standard Life Investments, which oversees about $393 billion. “If you were to put all the headlines that are out there in front of you, there aren’t any positive ones. Expectations are quite low for economic progress in terms of the data coming out this week.”

European shares surged 16 percent from a February low to an April 20 peak as commodity and energy producers rallied. The gains came even as analysts slashed their profit estimates for the region’s companies. They now predict an earnings decline in 2016 for Stoxx 600 firms, reversing calls for growth at the start of the year.

As well as earnings, investors will look to data including consumer prices and growth this week for signs of the health of the euro-area economy and the efficacy of European Central Bank stimulus measures.

Among stocks moving on corporate news, Electricite de France SA tumbled 11 percent, the most since at least 2005, after announcing plans to sell about 4 billion euros ($4.5 billion) of new shares and deepen cost cuts.

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