By Carla Mozee, MarketWatch
LONDON (MarketWatch) -- European stocks fell Tuesday, extending
recent losses as investors globally focus on concerns about stock
valuations, and as the conflict between Ukraine and Russia showed
no sign of abating.
The Stoxx Europe 600 fell 0.3% to 333.89. The index on Monday
declined 1.4%, marking its first loss in nine sessions, following a
sell-off in U.S. high-growth stocks.
The "slight" advantage for European markets is "it's likely
easier for investors to look for stocks [there], which are better
on a valuation perspective," said Naeem Aslam, chief market analyst
at AvaTrade, in a telephone interview.
Aslam said worries about Ukraine and Russia have re-emerged for
investors, with Russia now warning that any use of force against
pro-Kremlin separatists could push the country into civil war. "On
the back of that, we've seen a huge spike in gold," on speculation
that Russia will eventually increase its reach into Ukraine, he
said.
Gold futures for June delivery (GCM4) bounced up more than 1% to
above $1,313 an ounce. Shares of miner Randgold Resources Ltd. rose
1.8% and Fresnillo PLC tacked on 1.6%.
Sports Direct International PLC was among the biggest decliners
on both the Stoxx Europe 600 and the FTSE 100 index. The shares
plunged 9.2% after reports that British billionaire and company
founder Mike Ashley sold shares worth more than 200 million pounds
($322 million) in the sportswear retailer. The sale comes after a
bonus package for Ashley worth more than GBP70 million didn't find
enough support among shareholders. The package would have given
Ashley 8 million ordinary shares.
The FTSE 100 index ended down 0.5% at 6,590.69, with the U.K.
index weighed in part by declines among insurance shares. The group
is still hurting over a proposal in the U.K. budget that would end
a rule that required pension funds to be used to buy annuities, an
important source of business for some insurance companies, said
Aslam.
The proposal unveiled by U.K. Chancellor of the Exchequer George
Osborne last month "is completely a game changer" for the industry,
said Aslam, adding that shares of Prudential PLC and Aviva PLC have
been among the hardest hit. Prudential on Tuesday dropped 1.5%, and
Aviva lost 0.3%.
France's CAC 40 settled with a 0.3% loss at 4,424.83, and
Germany's DAX 30 fell 0.2% to 9,490.79.
On upside, stock in Bouygues SA climbed 1.3% following a report
that telecom operator Iliad SA is in talks to buy Bouygues's mobile
phone unit. Illiad also rose, by 0.7%.
Iliad is prepared to pay 5 billion euros ($6.9 billion) for
Bouygues Telecom, the third-biggest mobile phone operator in
France, according to a report in Le Parisien, which cited an
unidentified source. Bouygues is seeking 8 billion euros, the
report added. Iliad denied the talks, according to the report.
Bouygues shares on Monday stumbled 6% after the company's bid for
Vivendi SA's French mobile unit was rejected in favor of an offer
from Altice SA.
Also, Nokia Oyj shot up 5% after Chinese regulatory officials
approved the sale of the Finnish company's mobile business to
Microsoft Corp. (MSFT) .
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