UKX FTSE 100 Index

By Carla Mozee, MarketWatch

Ahold Delhaize shares rise after financial results

European stocks were falling Thursday, as German shares extended losses after a key survey showed an unexpected drop in business sentiment in the country.

The Stoxx Europe 600 shed 1.1% to 341.03, heading toward its first losing session in four. The health care group was putting in the worst performance.

The pan-European index was pulled lower in early morning trade as a selloff in German equities accelerated after the release of the Ifo index for August. The closely watched survey of the business climate in Europe's largest economy came in at 106.2 (http://www.marketwatch.com/story/germanys-ifo-index-falls-sharply-missing-views-2016-08-25), compared with 108.3 in July. Economists polled by The Wall Street Journal had expected a print of 108.5.

Germany's DAX 30 dropped by 1.3% to 10,488.13. Just before the release of the Ifo data, it was down by 0.8%.

"What we had feared could happen did unfortunately happen: German businesses continued a longer tradition of delayed reactions to single and unexpected events," said Carsten Brzeski, chief economist at ING, referring to the U.K. vote in June to leave the European Union.

"All in all, today's Ifo reading is a good reminder that the relative benign reaction of eurozone data to the Brexit vote should not be taken as given. The negative confidence impact is for real," he added in his note.

All of the DAX's components were in the red, led by a 2.3% fall in shares of car makers Volkswagen AG (VOW.XE) and Daimler AG (DAI.XE) .

The euro was at $1.1285, edging up after the Ifo report. It bought $1.1264 late Wednesday.

Pharma pain: Drug stocks were hit Thursday, with Shire PLC (SHPG) (SHPG) and Qiagen (QGEN) (QGEN) down 4.1% each. AstraZeneca lost 2.4% (AZN.LN) (AZN.LN) .

The pharma sector was under pressure "after comments from Hilary Clinton last night suggested that the (Democratic presidential) candidate would look to put pressure on drug makers to cut prices," said Chris Beauchamp, chief market analyst at IG, wrote in a note Thursday.

Read:How Hillary Clinton crushed another rally in biotech (http://www.marketwatch.com/story/how-hillary-clinton-crushed-another-rally-in-biotech-2016-08-24)

"This fall has combined with an ongoing rise in sterling that has taken some of the shine off the dividend stocks that were so much in demand after Brexit," he added.

Drug pricing was in focus as backlash has grown against Mylan NV's (MYL) decision to substantially raise the price of its EpiPen emergency allergy treatment.

Movers: Ahold Delhaize NV (AD.AE) shares rose 1.4% after the newly merged supermarket operator posted a 7% rise in underlying operating profit (http://www.marketwatch.com/story/ahold-delhaize-profit-up-merger-targets-on-track-2016-08-25), on a 3% rise in sales.

Indexes: France's CAC 40 fell 1.2% to 4,380.73, and the U.K's FTSE 100 gave up 0.7% to 6,786.28.

Italy's FTSE MIB fell 0.9% to 16,743.99, while Spain's IBEX 30 shed 1.1% at 8,562.10.

Portugal's PSI 20 moved 0.6% lower to 4,672.19. The European Union and Portugal on Wednesday reached an initial agreement to inject up to EUR2.7 billion ($3.05 billion) into state-owned Caixa Geral de Depositos SA, Portugal's largest lender by assets. (http://www.marketwatch.com/story/eu-portugal-reach-deal-to-shore-up-nations-largest-bank-2016-08-24)

Read:Why Portugal could be Europe's next economic disaster (http://www.marketwatch.com/story/why-portugal-could-be-europes-next-economic-disaster-2016-08-24)

(END) Dow Jones Newswires

August 25, 2016 05:24 ET (09:24 GMT)

FTSE 100
Index Chart
From Mar 2024 to Apr 2024

FTSE 100
Index Chart
From Apr 2023 to Apr 2024