European Stocks Little Changed Amid Earnings From ABB, Barclays

  • Nokia, Telefonica slide after results; BBVA, STMicro gain
  • Stoxx 600 is heading for back-to-back monthly decline

European Stock Decline Stretches to a Fourth Day

European stocks were little changed as earnings updates from ABB Ltd. to Barclays Plc gave investors mixed signals on the outlook for corporate health.

ABB tumbled 6.6 percent after the industrial firm reported a decline in orders, seen as an indication of future sales. Nokia Oyj plunged 7.6 percent after warning that slowing demand for wireless-network equipment will continue to hurt revenue this quarter. Barclays rose 4.8 percent after reporting an increase in profit.

The Stoxx Europe 600 Index fell less than 0.1 percent at the close, after swinging between gains and losses of 0.5 percent. The benchmark has gone without gains for five straight sessions, and is heading for its first back-to-back monthly retreat since the start of the year.

“It’s a classic case of markets fluctuating depending on the quality and strength of company results in the middle of the earnings season,” said Jacques Porta, who manages 50 million euros ($55 million) at Ofi Patrimoine Gestion Privee in Paris. “The visibility on European earnings is weak, considering the economic growth. The macroeconomic outlook is not as robust as in the U.S.”

Investors are assessing prospects for earnings at a time when the U.K.’s secession vote and political momentum for anti-establishment parties threaten an already fragile European recovery. The euro-area economy is forecast to grow at a pace of 1.5 percent or slower in the next two years, versus 2.1 percent for the U.S.

Weaker-than-forecast corporate results have prompted equity declines this week, unraveling gains that took the Stoxx 600 to a two-week high on Oct. 20 amid optimism over central-bank policy support. The benchmark trades below its level on the day of the Brexit vote, after briefly rising above it in September. Analysts project a 4.3 percent decline in Stoxx 600 company profits in 2016.

Among other shares active on corporate news:

  • Telefonica SA fell 1 percent as Europe’s most indebted phone company cut its 2017 dividend after failing to sell its U.K. wireless unit.
  • ASM International NV lost 3.6 percent after the semiconductor company posted a drop in third-quarter sales.
  • Fingerprint Cards AB retreated 4.8 percent as the biometric-sensor maker reported worse-than-estimated profit.
  • Amec Foster Wheeler Plc plunged 20 percent after the energy-services company said it sees continued weakness in some key markets.
  • Banco Bilbao Vizcaya Argentaria SA added 2.8 percent after its earnings beat analyst estimates.
  • STMicroelectronics NV gained 10 percent after its forecast for fourth-quarter gross margin exceeded estimates. 
  • Technip SA climbed 2.2 percent as the oil-service provider posted results that topped projections.
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