Skip Header
Important information: The value of investments can go down as well as up so you may get back less than you invest. Investors should note that the views expressed may no longer be current and may have already been acted upon. This is a third-party news feed and may not reflect Fidelity’s views.

Europe midday: Shares down on luxury stocks, weak PMI data

(Sharecast News) - European shares were lower on Wednesday, with luxury stocks under the pump as LVMH second-quarter sales growth missed consensus estimates and eurozone service and manufacturing surveys showing weaker readings.

The pan-European Stoxx 600 index was down 0.4% at 513.42 with most major regional bourses lower. Sentiment was also hit by disappointing corporate earnings from Wall Street heavyweights overnight.

In after-hours trade in the US, Tesla shares fell sharply after the electric carmaker said net profits fell 45% in the second quarter, while Google parent Alphabet disappointed with slowing ad sales growth. In other news, Visa, UPS and GM also underwhelmed investors with their latest numbers.

"As such, two of the Magnificent 7 stocks failed to create euphoria when they reported their Q2 results yesterday. The less-than-ideal set of earnings comes at a time when investors are questioning whether the AI rally has gotten ahead of itself," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

In economic news, The eurozone composite purchasing managers index fell 0.8pts to 50.1 - its second consecutive monthly decline. Both services and manufacturing output saw weaker readings,

Consumer sentiment in Germany rose to its highest level in more than two years, according to a closely watched survey from GfK and the Nuremberg Institute for Market Decisions, as income expectations and the economic outlook improved significantly.

The GfK Consumer Climate index for August increased to -18.4, up from a revised -21.6 in July and ahead of the -21.0 expected by economists. This was the highest reading since April 2022.

On the equities front Deutsche Bank shares fell after reporting a loss in the second quarter, higher-than-expected provisions. and revealed that a second share buyback was off the table this year.

Luxury stocks were all down after the LVMH numbers with Hugo Boss, Christian Dior and Kering all lower. Hugo Boss was also hit by a downgrade from Exane BNP Paribas to 'underperform' from 'outperform' citing slower topline momentum and pressure on margins.

Shares in Nexans surged after the cable and optical fibre group posted better-than-expected first half results and raised its annual guidance.

French planemaker Dassault Aviation was also flying higher after it on Tuesday reported higher first half adjusted net sales.

Defence firm Rheinmetall gained after it reported second-quarter sales and operating results above expectations.

Budget airline easyJet soared after it lifted its holiday forecast following a 16% rise in profit.

Reporting by Frank Prenesti for Sharecast.com

Share this article

Related Sharecast Articles

London close: Stocks finish Friday in the red
(Sharecast News) - London stocks ended the week lower on Friday as investors reacted to US president Dinald Trump's announcement of reciprocal tariffs, while weakness in NatWest added to the pressure after the lender's latest results failed to impress.
Broker tips: Spirax Group, Costain, Inchcape, NatWest
(Sharecast News) - Shore Capital downgraded Spirax Group on Friday to 'sell' following a 20% share price rise since it upgraded to 'hold' shortly after the in line update on 14 November 2024.
Director dealings: LBG Media director ups stake
(Sharecast News) - LBG Media revealed on Friday that non-executive director Carol Kane had acquired 46,844 ordinary shares in the London-listed digital entertainment business.
Europe close: Stocks edge higher heading into the weekend
(Sharecast News) - European shares were mostly higher on Friday adding to the previous session's gains.

Important information: This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Past performance is not a reliable indicator of future returns.

Award-winning online share dealing

Search, compare and select from thousands of shares.

Expert insights into investing your money

Our team of experts explore the world of share dealing.