By Carla Mozee, MarketWatch
LONDON (MarketWatch) -- European stocks clung to record highs
Monday, with the benchmark Stoxx Europe 600 withstanding losses
among miners after dim outlooks for the iron-ore sector.
The Stoxx Europe 600 closed up 0.2% at 413.63, Gains for
telecom, technology, utility, energy and financial shares helped
the pan-European index close at a record. Last week, the benchmark
broke through the record closing high that had stood for 15
years.
Read: Thank Draghi! European stocks close at highest level ever
(http://www.marketwatch.com/story/thank-draghi-european-stocks-hit-highest-level-ever-2015-04-09)
But on Monday, basic resources stocks dipped as analysts at
Citigroup cut their stance on the iron-ore sector to neutral from
bullish, in line with major forecast revisions by Citi's commodity
team.
Separately, Standard & Poor's cut its iron-ore price
forecasts for 2015, 2016 and 2017, and placed several iron-ore
producers on watch for possible ratings downgrades. "In our view,
lower iron ore prices may not only weaken producers' operating cash
flows and financial leverage, but may also affect the long-term
resilience of some companies' business risk profiles, given the
higher-than-anticipated earnings volatility due to iron-ore-price
swings.
Among the hardest hit stocks was BHP Billiton PLC (BHP) , which
fell 2.8%. Citi cut its rating on the iron-ore mining heavyweight
to neutral from buy and moved it off its European focus list. Citi
also cut its rating on miner Anglo American PLC , to sell from
neutral. Anglo's shares fell 2.2%.
The pullback in mining shares weighed on the U.K.'s FTSE 100
(http://www.marketwatch.com/story/ftse-100-eases-from-record-with-bhp-hurt-after-downgrade-2015-04-13)
, which lost 0.4% to 7,064.30, stepping from a record closing high
set on Friday.
In Paris, the CAC 40 rose 0.3% to 5,254.12 and Italy's FTSE MIB
picked up 0.6% to 24,008.91. Spain's IBEX 35 ended 1% higher at
11,866.40.
But Germany's DAX 30 fell 0.3% to 12,338.73. Car maker
Volkswagen AG lost 1.9% after a crisis over leadership erupted
Friday
(http://www.marketwatch.com/story/volkswagen-faces-fight-over-future-leadership-2015-04-13),
with Chief Executive Martin Winterkorn vowing to resist efforts to
oust him.
Equity trading in Greece was closed for the Orthodox Easter
holiday.
Investors will begin to start to see more companies rolling
their financial updates. Analysts expected, as of Friday,
first-quarter earnings on the Stoxx 600 to rise 0.7% from the same
period last year, according to Thomson Reuters data. In a typical
quarter, 48% of companies beat per-share earnings estimates.
First-quarter revenue, however, is expected to drop 11.4% from the
year-earlier period.
Read: Earnings growth may add more fuel to Europe's stock rally.
(http://www.marketwatch.com/story/growth-in-earnings-may-add-more-fuel-to-europes-raging-stock-rally-2015-04-13)
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