BLBG: European Stocks Erase Decline As Carmakers Rally
European stocks erased their decline as carmakers rallied, outweighing renewed concern that the euro area’s sovereign-debt crisis is worsening. U.S. index futures were unchanged, while Asian shares retreated.
BT Group Plc (BT/A) slid 5.5 percent after the U.K.’s largest fixed-line phone company reported falling sales. PSA Peugeot Citroen advanced 1.3 percent after reporting an operating profit in the first half, while analysts had predicted a loss.
The Stoxx Europe 600 Index added 0.1 percent to 250.89 at 8:21 a.m. in London. The benchmark measure slipped 4.3 percent over the three days through yesterday on concern Greece will default and more Spanish regions will follow Valencia in seeking a central government bailout. Standard & Poor’s 500 Index futures expiring in September were unchanged today, while the MSCI Asia Pacific Index decreased 1 percent.
“Sentiment in Europe continues to deteriorate at a rate of knots,” said Michael Hewson, a market analyst at CMC Markets U.K. Plc. “The economic outlook doesn’t appear to be getting any better and continues to point to further weakness.”
China’s slowing economy faces significant downside risks and relies too much on investment, the International Monetary Fund said in an annual review. The Washington-based lender repeated an assessment that the yuan is “moderately” undervalued, and urged leaders to increase consumption and channel citizens’ savings away from housing.
In Germany, a report at 10 a.m. in Munich may show that a gauge of business confidence slipped in July to the lowest level since March 2010. The Ifo institute’s business climate index, based on a survey of 7,000 executives, will drop to 104.5 from 105.3 in June, according to the median forecast of economists in a Bloomberg News survey.
Greek Prime Minister Antonis Samaras will meet with representatives of the European (SXXP) Commission, the European Central Bank and the IMF -- the so-called troika -- on July 27, amid concern the country will fail to abide by the commitments needed to obtain continued financial aid.
To contact the reporter on this story: Namitha Jagadeesh in London at njagadeesh@bloomberg.net
To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net
