European Stocks Are Little Changed Amid Ukraine Tension
European stocks were little changed, after dropping yesterday from a six-year high, as investors weighed escalating tensions between America and Russia over the future of eastern Europe. U.S. index futures and Asian shares were also little changed.
Suedzucker AG tumbled the most since at least 1998 after saying revenue and profit in the year through February 2015 will miss analysts’ estimates. Sports Direct International Plc slid the most this year after the Financial Times reported that founder Mike Ashley was selling a 4 percent stake. Nokia Oyj climbed 2.8 percent after getting China’s approval for the sale of its handsets business to Microsoft Corp.
The Stoxx Europe 600 Index slipped 0.2 percent to 334.4 at 10:16 a.m. in London. The benchmark measure lost 1.2 percent yesterday as technology shares retreated. The gauge has advanced 1.9 percent in 2014. The Standard & Poor’s 500 Index futures added 0.1 percent today, while the MSCI Asia Pacific Index slid 0.1 percent.
“Ukraine worries, coupled with stock valuations which are high, are taking their toll on European markets,” Stephane Ekolo, chief European strategist at Markit Securities in London, wrote in an e-mail. “We are seeing an aggravation in the situation in Ukraine with some eastern provinces trying to declare independence and turning towards Russia.”
The Stoxx 600 trades at 14.64 times the projected earnings of its members, compared with a price-earnings multiple of 13.79 on Jan. 1 and its five-year average of 12.31.
Russian Threat
Ukraine sent additional police forces into its eastern regions after pro-Russian protesters seized government buildings in Donetsk, Luhansk and Kharkiv this week. The U.S. accused Russia of instigating the raids, amid increasing concern that Russian President Vladimir Putin plans to make Ukraine a loose federation. The U.S. has said there is evidence that some protesters may be paid provocateurs.
Suedzucker AG slumped 16 percent to 17.25 euros. The maker of sugar, starch and bakery additives projects full-year revenue of about 7 billion euros ($9.6 billion), below analysts’ estimates of 7.5 billion euros. The company, which is reviewing costs in the sugar business, said it expects operating profit of about 200 million euros, trailing estimates of 608 million euros.
Sports Direct slid 6.6 percent to 834.5 pence, for its biggest drop since Dec. 12. Ashley was selling 200 million pounds ($332 million) of shares in the sporting-goods retailer with Goldman Sachs Group Inc. as the sole book runner, FT reported. Ashley sold the stake after acquiring an 11 percent stake in House of Fraser Ltd.
Cie. de Saint-Gobain SA fell 2.7 percent to 44.17 euros. Groupama SA sold its entire 1.8 percent stake in Europe’s biggest supplier of building materials for 450 million euros.
Nokia (NOK1V) rose 3 percent to 5.48 euros. China’s Ministry of Commerce said it has approved Nokia’s deal with Microsoft after the U.S. software company pledged it won’t ban Chinese phone makers from using its patents. With this clearance, Nokia expects the transaction to be completed this month.
Source: bloomberg
