ASML shares advance after posting profit; Icap shares drop
By Sarah Turner, MarketWatch
LONDON (MarketWatch) -- European shares failed to extend their winning streak to a seventh session on Wednesday, as losses for automakers and banks offset earnings-inspired gains in the technology sector.
After trading as high as 257.03 earlier in the session, the Stoxx Europe 600 index (ST:SXXP 255.12, -0.87, -0.34%) declined 0.5% to 254.65 in afternoon trading.
Autos were leading the decline, paring some sharp gains made Tuesday after German premium-car maker BMW AG lifted its outlook.
Shares of BMW (DE:BMW 41.45, -0.40, -0.96%) declined 1.7% and Renault (FR:RNO 34.90, -0.38, -1.08%) shares were down 1.8%.
Banks were also under pressure, with UniCredit (IT:UCG 2.06, -0.02, -1.08%) shares down 1.4%, as it issued a €500 million bond.
Shares of Credit Suisse (CH:CSGN 44.99, -0.71, -1.55%) (CS 43.38, +0.55, +1.28%) fell 1.3% after reports that German prosecutors searched 13 of the lender's offices as part of a probe into whether the bank's employees may have helped clients evade taxes.
"Given the risks to the sector, uncertainty regarding pending regulatory reform and that Greek sovereign debt fears have not fallen away, the sector should arguably be on more of a discount. Furthermore, it is not yielding more than other low-growth sectors such as telecoms or utilities," said Goldman Sachs strategists on the banking sector.
Of the major regional benchmarks, the FTSE 100 index (UK:UKX 5,238, -32.83, -0.62%) lost 0.6% to 5,237.38, the French CAC-40 index (FR:PX1 3,622, -15.57, -0.43%) declined 0.6% to 3,617.37 and the German DAX index (DX:DAX 6,191, -0.04, -.00%) down 0.1% to 6,184.11.
Asian shares ended higher after strong results from chip giant Intel Corp. (INTC 22.40, +1.39, +6.62%) and U.S. stock futures were pointing to gains on Wall Street, with Dow Jones Industrial Average futures up 21 points.
Intel's results and a better-than-expected second-quarter profit from Netherlands-based ASML (NL:ASML 25.77, +1.37, +5.62%) (ASML 32.70, +1.43, +4.57%) gave European stocks an early boost and technology shares were firm through the session. Read more on Intel. Read story on ASML.
ASML shares rallied 5.6%, STMicroelectronics (FR:STM 6.91, +0.15, +2.19%) (STM 8.78, +0.11, +1.27%) shares were up 2.1% and Infineon Technology (DE:IFX 5.27, +0.06, +1.11%) shares rose 1.7%.
Also advancing, London Stock Exchange (UK:LSE 624.00, +19.50, +3.23%) shares rose 2.4%.
The firm reported a 1% rise in fiscal first-quarter revenue and said its market share of the trading in U.K. stocks improved in June after it lowered transaction fees.
Interdealer-broker Icap (UK:IAP 414.00, -22.20, -5.09%) dropped 5.2%. The firm announced a 5% rise in quarterly profit and 8% revenue growth but said that trading levels "slowed significantly" in June as customers' risk appetite declined. Read more on Icap, LSE.
Shares of television broadcaster ITV (UK:ITV 52.35, -2.15, -3.95%) declined 4.1% after it was downgraded to underperform from neutral by Bank of America Merrill Lynch.
The broker said the stock is too expensive, "unless ITV adopts a subscription model, given macro uncertainty and ongoing structural pressures."
