Friday, October 25 16:29:41
European equities edged lower today, with Telecom Italia leading the telecoms sector down on concerns about a capital hike by the Italian company and Volvo hurting industrials after reporting a sharp drop in profits.
The Italian telecom operator slumped 5.8 percent, pushing the STOXX Europe 600 telecoms index 1.1 percent lower to the bottom of sectoral performers, as traders said the heavily indebted group was set to decide to sell more shares and cancel its dividend.
Weaker industrials put pressure on the market, with the sector index falling 0.6 percent, pressured by a 6.7 percent drop in Volvo after the truckmaker reported a sharp drop in profit.
"The earnings season will continue to inject volatility in the market in the near-term as results of the companies exposed to emerging markets could disappoint because of currency-related issues," said Koen De Leus, senior economist at KBC.
"Recent economic numbers have also made investors a bit nervous. But the market's medium-tern outlook remains positive as the U.S. Federal Reserve is not likely to start trimming its bond purchases until the first quarter of 2014."
Losses were capped by a 0.8 percent rise in the European oil and gas index, helped by a 3.7 percent gain in Premier Oil after the company commenced gas production from the Rochelle field, and a 1.2 percent rise in Neste Oil following a target price hike by Barclays.
At 1455 GMT, the pan-European FTSEurofirst 300 index was down 0.2 percent at 1,283.44 points. However, it rose 0.5 percent this week and remained on track for a third straight week of gains.