By Carla Mozee, MarketWatch
LONDON (MarketWatch) -- European stocks fell Tuesday, with
shares of major industrial firms Royal Philips NV and Siemens AG
among those pulling the regional market's benchmark toward its
first loss in nine sessions.
The Stoxx Europe 600 lost 0.8% to 369.35 coming off Monday's
close at a fresh seven-year high, as investors took in their stride
the widely expected victory for anti-austerity Syriza in Greece's
general election.
Markets extended losses in step with U.S. stock futures as one
earnings disappointment after another rolled in. On the country
benchmarks, Germany's DAX fell 1.3% to 10,658.64, after closing a
record high on Monday. France's CAC 40 lost 1.3% to 4,614.48.
Focus turned to a raft of financial results. Royal Philips fell
6%, trading near the bottom of the Stoxx 600, as the Dutch
electronics maker warned that it may not hit its financial targets
for 2016. The warning comes as the company grapples with
operational setbacks in its health care division. Also,
fourth-quarter profit at Philips sank 67%.
Siemens shares were dragged 3% lower after the German
engineering heavyweight said weakening in the European economy and
the drop in oil prices left its fiscal first-quarter profit down
nearly 25% at 1.08 billion euros ($1.21 billion). Earnings from
continuing operations fell 18% to EUR1.11 billion, missing
expectations of EUR1.26 billion by analysts polled by The Wall
Street Journal.
Also lower, retailer Dixons Carphone PLC lost 4% following a
downgrade to underweight from equal weight at Morgan Stanley.
But among advancers was Novartis AG , rising 1.9% after the
Swiss drug maker said it expects business to gain momentum even as
its posted a decline in fourth-quarter profit.
EasyJet PLC shares gained 2.3% after the budget airline raised
its revenue forecast and reported first-quarter sales growth that
beat expectations. Also, shares of British Airways parent
International Consolidated Airlines Group rose 1.6% after the
company said the board of Aer Lingus Group PLC is ready to
recommend its takeover offer.
EasyJet and IAG shares outperformed the broader U.K. equity
market, with the FTSE 100 giving up 0.7% to 6,807.63 after eight
days of gains. Stocks remained lower after U.K. gross domestic
product growth of 0.5% in the fourth quarter and 2.6% for the year
were below analyst expectations.
Meanwhile, Greece's Athex Composite fell 4.6%, extending losses
from Monday following the general election.
Moody's Investors Service said in a report dated Monday that the
victory for Syriza is a "credit negative" for the country.
Uncertainty stemming from the result "will hurt Greek banks'
ability to access funding and maintain liquidity," Moody's said in
its report.
Yields on Greek government bonds climbed Tuesday, with borrowing
costs on 10-year paper rising 48 basis points to 9.496%, according
to electronic trading platform Tradeweb.
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