Europe close: Stocks mostly lower on Greece, slide in oil and gas shares
Most European equities dropped, dragged by a slump in oil and gas stocks and worries on Greece.
Greece’s Athex Composite Index was in the red on its second day of trading since the closure of the stock market five weeks ago, but faring a lot better than it did on Monday, down 1.6% and paring losses from earlier in the session.
“Yesterday we had one of the most fragile day in Athens when its stock market opened. Investors used this opportunity to punish the market with a maximum sentence as the Greek banks closed towards their daily maximum limit level of 30%,” said Naeem Aslam, chief market analyst at Ava Trade.
Greek government spokeswoman Olga Gerovasili said on Tuesday that the country expects to conclude a bailout deal with its international creditors by 18 August.
Overall, the Stoxx 600 oil and gas index was the worst performer following the heavy selloff in oil prices in the previous session.
In economic data, a report on US factory orders showed a 1.8% increase in June, as expected, after a 1.1% drop a month earlier.
Producer prices in the Eurozone fell 2.2% year-on-year in June from a 2% decline in May, in line with expectations, according to Eurostat. On a monthly basis, producer prices nudged down 0.1% compared with expectations for a flat reading.
The Markit/CIPS purchasing mangers’ index on UK construction activity fell to 57.1 in July from 58.1 a month earlier, missing forecasts for a reading of 58.5. A reading above 50 indicates expansion while a number below that signals a contraction.
Companies
Royal Bank of Scotland regained ground following an earlier fall on news that the UK government has sold 360m shares in the bank for £2.08bn, which equates to a stake of 5.2%.
Gerrman car maker BMW dropped after reporting a decline in second-quarter profits on the back of higher costs. The company also cautioned the landscape in China was increasingly competitive.
Credit Agricole tumbled after revealing that it was under investigation by US authorities over potential sanctions breaches
British insurer Standard Life edged lower as it posted a drop in first-half UK operating profit to £141m from £165m in the same period last year, on the back of lower annuity sales following the pension reforms.
Engineering company Smiths Group was the standout gainer on London’s FTSE 100 index as it emerged that US activist hedge fund ValueAct is a shareholder. According to the Financial Times, ValueAct’s stake in Smiths is below the 5% required for disclosure to the London Stock Exchange.
Shares in London-listed insurer Direct Line rose after it reported a rise in pre-tax profit for the first half and a largely unchanged gross written premium, as it said underlying trends remain broadly in line with prior expectations.
Car parts maker Continental rallied after raising its full-year profit outlook thanks to an improved European car market, while French insurer AXA nudged higher after posting a 2% rise in first-half net income.