Home Economy News European stocks drop as tech, resource stocks slip; economic data in focus

European stocks drop as tech, resource stocks slip; economic data in focus


European stocks drop as tech, resource stocks slip; economic data in focus By Reuters

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Published Mar 11, 2024 04:36AM ET
Updated Mar 11, 2024 06:12AM ET

© Reuters. The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, march 8, 2024. REUTERS/Staff/file photo

By Khushi Singh

(Reuters) -European shares moved lower on Monday, hurt by a sell-off in technology and resource stocks, and cautious trading ahead of a key U.S. inflation report due this week.

The pan-European STOXX 600 was down 0.5% by 9:41 GMT, and on track for its biggest one-day percentage drop in a month if losses held.

Technology index dropped 1.7%, leading sectoral declines, following a 7.9% decline in BE Semiconductor Industries (AS:BESI)’ shares.

The chipmaking parts supplier tumbled to the bottom of STOXX 600 on worries over potential delays in hybrid bonding adoption.

The basic resources index followed with a 1.6% slip as “resources are some of the most sensitive assets to the dollar and bond yields and we’re seeing a bit of natural profit taking ahead of U.S. inflation data”, said Ben Laidler, global markets strategist at eToro.

Investors awaited Tuesday’s U.S. February inflation data that would dominate market action, along with figures on euro zone January industrial production, due later in the week, for fresh clues on the timing of interest rate cuts.

“The strong U.S. jobs report on Friday added to the feeling that the inflation number tomorrow is going to be a little bit hot and that’s another reason why European assets sort of backed off a little this morning in anticipation of a hotter inflation number tomorrow”, Laidler added.

Both the U.S. Federal Reserve and the European Central Bank look set to start the monetary policy easing cycle from June, and softer economic readings could further boost that sentiment.

In corporate updates, LEG Immobilien’s shares rose 2.4% after the German real estate firm reported a full-year results beat and said it would propose a higher-than-expected dividend.

Italian regional utility A2A shares dropped 3.5% upon signing a $1.3 billion deal agreement to buy some electricity distribution networks from Enel (BIT:ENEI).

Shares in Telecom Italia (BIT:TLIT) shed 7.7% after the company said its pro-forma net debt following its planned landline network sale will rise to about 7.5 billion euros ($8.21 billion) by the end of 2024.

Meanwhile, Portugal’s PSI index moved 0.4% lower after the centre-right Democratic Alliance won Portugal’s general election, though it was unclear if they could govern without the support from far-right Chega.

European stocks drop as tech, resource stocks slip; economic data in focus

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