LONDON (MarketWatch) - European shares Thursday pared strong gains made in the previous session in the first chance Continental investors had to react to the U.S. rate decision.
The pan-European Dow Jones Stoxx 600 index (ST:SXXP 204.30, -2.03, -0.98%) declined 0.5% to 205.22. Every sector was in negative territory in early trade.
The index closed up 2.5% on Wednesday on the back of a strong performance from banks and mineral extractors ahead of a rate decision from the U.S. Federal Reserve.
The Fed kept rates on hold, as widely expected, although it said the U.S. economy is likely to remain weak. See full story.
On a regional level, the U.K. FTSE 100 index (UK:UKX 4,257, -22.55, -0.53%) declined 0.5% to 4,260.41, the German DAX index (DX:DAX 4,779, -56.92, -1.18%) declined 0.9% to 4,793.03 and the French CAC-40 index (FR:PX1 3,153, -31.49, -0.99%) lost 0.7% to 3,161.26.
Futures were pointing to a higher open in the U.S., with Dow Jones Industrial Average futures up 17 points.
Of companies in the spotlight, BP (UK:BP. 477.50, +1.00, +0.21%) (BP 46.97, -0.14, -0.30%) shares fell 1.1% after the oil major said that Ericsson's CEO, Carl-Henric Svanberg, will become its new chairman, succeeding Peter Sutherland.
Hans Vestberg, Ericsson's 44-year-old executive vice president and chief financial officer, will be Ericsson's (SE:ERICB 76.70, +2.10, +2.82%) (ERIC 9.62, +0.19, +2.01%) new CEO. Ericsson shares were down 0.9% in Stockholm.
Earnings were also a focus in Europe, with Adidas (DE:ADS 27.51, -0.23, -0.83%) shares down 1.9% and Puma (DE:PUM 159.00, +4.33, +2.80%) shares down 1.5% in Frankfurt after U.S. rival Nike reported that its quarterly profit dropped 30%.
Orders in Europe, the Middle East and Africa are particularly weak, Nike noted.
On the plus side, shares of Swedish fashion retailer Hennes & Mauritz (SE:HMB 370.50, +10.50, +2.92%) advanced 1.9% after its second quarter profit rose 6% to 4.2 billion Swedish kronor ($533 million), which was just ahead of analyst forecasts for a profit of 4.1 billion kronor.
H&M said that its spring collection was well received by customers and that performance in Japan and Russia surpassed expectations.
Shares of French conglomerate Bouygues (FR:EN 27.56, +1.03, +3.87%) climbed 2.4% after it was upgraded to buy from neutral at Goldman Sachs, with the broker citing valuation.
"Flexibility in the cost base and stimulus tailwinds will drive a strong earnings recovery," the broker noted. "We see the stock as a prime beneficiary in our coverage universe from a normal risk environment," it added.
