Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

European shares hit two-week low as euro surges

Published 08/28/2017, 12:08 PM
Updated 08/28/2017, 12:08 PM
© Reuters. Traders work in front of the German share price index, DAX board, at the stock exchange in Frankfurt

© Reuters. Traders work in front of the German share price index, DAX board, at the stock exchange in Frankfurt

By Danilo Masoni and Helen Reid

MILAN/LONDON (Reuters) - European shares fell on Monday as the euro strengthened after ECB chief Mario Draghi expressed no concern about a strong currency in a closely watched speech.

The STOXX index for euro zone stocks (STOXXE) fell as much as 0.7 percent to a two-week low before paring its losses to end 0.4 percent lower on the day. London was closed for a holiday, reducing activity.

The export-oriented DAX (GDAXI) fell 0.3 percent and the broader pan-European STOXX 600 index (STOXX) slipped 0.5 percent.

In a speech at a symposium of central bankers at Jackson Hole, Wyoming, Draghi did not try to talk down the euro, which climbed to its highest in more than two years against the dollar.

"The Jackson Hole meeting has been explosive for the euro and the U.S. dollar traders," London Capital Group analyst Ipek Ozkardeskaya said in a note.

Euro zone shares reached their highest in more than two years in May, as strong macro data and company results drew investors. But the recent surge in the euro has weighed on stocks.

Almost all sectors suffered losses on Monday with materials (SXPP) and construction stocks (SXOP) the biggest drag to the region's equities.

Finnish paper makers Stora Enso (HE:STERV) and UPM-Kymmene (HE:UPM) fell 3.7 to 5.1 percent after a report that Danske Bank downgraded them, citing a weaker dollar, higher input costs and lower prices of paper mass.

Reinsurance stocks suffered after flooding triggered by Tropical Storm Harvey devastated Houston. Shares in Hannover Re (DE:HNRGn) were fell 1.3 percent and Munich Re (DE:MUVGn) 0.9 percent. French reinsurer Scor (PA:SCOR) dropped 1.5 percent.

Shares in German drugmaker Stada (DE:STAGn) suffered some selling, down 3.6 percent, as investors took profits after the stock surged to an all-time high on Friday when hedge fund Elliott increased its stake in the company.

Dutch supermarket group Ahold Delhaize (AS:AD) stumbled again, down 2.6 percent after sharp losses on Friday when Amazon's plans to cut prices at Whole Foods Market (NASDAQ:WFM) dented retailer stocks.

Broker Raymond James cut its target price on Ahold to factor in "growing competitive risk" from the merger.

Among the very few gainers were shares in tyre maker Michelin (PA:MICP), which gained 1.5 percent after Oddo BHF analysts raised the stock to a "buy", saying a pick-up in agricultural and mining sectors would benefit the firm's specialty tyre business .

© Reuters. Traders work in front of the German share price index, DAX board, at the stock exchange in Frankfurt

For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.