European Stocks Little Changed as ABB, Miners Offset Energy Drop
Crude prices retereat as Kuwait workers agree to end strike
Miners advance as BHP Billiton cuts iron ore output forecast
European stocks were little changed as miners advanced and investors focused on companies that posted better-than-expected earnings, offsetting a slide in oil prices that weighed on energy producers.
Anglo American Plc and ArcelorMittal paced resource-related companies higher with gains of at least 3.7 percent after BHP Billiton Ltd. joined Rio Tinto Group in cutting its iron ore production forecast for its Australian operations, spurring gains in the metal’s price. ABB Ltd rose 3.3 percent after the world’s largest maker of power grids postedhigher-than-forecast first-quarter profit. BP Plc fell 1.1 percent, leading oil stocks lower as workers in Kuwait said they would end a strike that had disrupted crude output. SAP SE helped drag technology shares lower after first-quarter sales rose less than analysts expected.
The Stoxx 600 slipped 0.1 percent to 348.93 at 1:44 p.m. in London, snapping a two-day advance that had pushed it out of a holding range it was languishing in for a month. While shares rose in seven of the last eight sessions through yesterday, the European gauge has still tumbled 16 percent since reaching a record a year ago, and optimism over European Central Bank stimulus has given way to skepticism about its ability to boost growth.
“It’s difficult to find a major positive trigger from here,” said Otto Waser, chief investment officer at R&A Research & Asset Management. “Central banks are done so we don’t expect anything positive from them anymore. Earnings trends are not positive enough in Europe to support a major positive market.”
While economists are virtually certain Mario Draghi won’t touch interest rates at Thursday’s ECB meeting, recent history shows that increased stock volatility is still likely. Intraday swings for the Euro Stoxx 50 Index averaged 4.1 percent during the ECB President’s past four policy updates, or about double that for all meetings since 2010.
Among stocks moving on corporate news today, Commerzbank AG fell 1.9 percent after Chief Executive Officer Martin Blessing said a slow first quarter will make it more difficult to match last year’s profit, just a month after the bank projected an increase in full-year earnings.