European stocks declined on Thursday as a drop in the shares of major financial companies weighed on the region's markets.
|||London - European stocks fell on Thursday as a drop in the shares of major financial companies such as Aegon and Credit Agricole weighed on the region's markets.
The pan-European FTSEurofirst 300 index declined by 0.7 percent, while the euro zone's blue-chip Euro STOXX 50 index fell 0.6 percent.
Aegon was one of the worst-performing stocks in the region. It slumped 7.8 percent after the Dutch insurer reported worse-than-expected first-quarter underlying pretax profit of 462 million euros ($527.19 million).
Credit Agricole also fell 3.6 percent after the French bank reported a 71 percent fall in first-quarter net income, although RWE shares rose after the German utility's results beat forecasts.
According to data from Thomson Reuters StarMine, 61 percent of the companies on the pan-European STOXX 600 index have beaten or met market forecasts with their first quarter earnings, although many have done so by cutting costs in order to offset lower revenues.
“Corporate results have not been that great so far,” said Francois Savary, chief investment officer at Geneva-based fund management and consultancy firm Prime Partners.
“We reduced our equity exposure in April after the market rallied up from the February lows, and we see no need to rush back into the market for now,” he added.
The FTSEurofirst is down by around 9 percent so far in 2016, with global stock markets affected by concerns about weakness in China, the world's second-biggest economy.
UBS equity strategist Karen Olney highlighted how investors were taking money out of mainland European equity exchange traded funds (ETFs), and added that those outflows were at their worst level since the global financial crisis of 2008.
Olney said $10 billion of net-selling in mainland European ETFs since late January showed how monetary stimulus measures from the European Central Bank (ECB) were only having a limited impact.
“Relentless ETF outflows - worst since 2008,” Olney wrote in a research note.
REUTERS
