European shares go sideways as skepticism looms on recovery
European shares faltered on Tuesday morning in contrast with Wall Street which bounced back for a second day overnight, and as a flurry of corporate results failed to lift indexes.
The pan-European STOXX 600 index was just slightly negative, down 0.02 percent at 0920 GMT with bourses and sectors trading sideways in the absence of a clear upward or downward trend.
“Wall Street is looking to build on a big two-day rally but there is as yet no real conviction behind this, as evidenced by the softer performance in European indices this morning,” commented Neil Wilson, senior market analyst at ETX Capital.
“We are yet to build consensus around this rally and it could run into trouble if conviction is lacking”, he added.
A flurry of corporate results yielded both positive and negative reactions on European trading floors.
The telecoms sector suffered after Telenet reported 2017 results. The Belgian operator fell over 7 percent, the worst performer on the STOXX.
Shares in Gucci owner Kering slid 2.6 percent despite the luxury group reporting stronger-than-expected Q4 sales growth.
Rival LVMH lost 1.2 percent.
Smelter Aurubis fell about 4 percent after its results fell short of the average forecast in a Reuters poll.
On the other hand, shares in French video game producer Ubisoft rose 5.1 percent after a trading update which took it to the top of the STOXX 600.
Randstad, the world’s second-largest staffing company and a bellwether for the economy, saw fourth-quarter core profit rise 15 percent, buoyed by a strong recovery in the European job markets. Its shares gained 0.9 percent.
European travel group TUI was the best performer of the FTSE and rose 4.6 percent after reporting that summer bookings for Turkey were recovering, echoing comments by rival Thomas Cook and adding to hopes that pressure on profit margins for tour operators may ease.
The travel and leisure sector was among the few to trade firmly in positive territory, up 0.9 percent, with Lufthansa and Easyjet up 1.9 percent and 1.7 percent respectively.
(LONDON (Reuters) – Reporting by Julien Ponthus; Editing by Helen Reid and Raissa Kasolowsky/ Our Standards:The Thomson Reuters Trust Principles.)