February 8, 2019
LONDON (Reuters) – European stocks faltered on Friday after their worst day in six weeks as downgrades to growth forecasts weighed, while weak numbers from Umicore, Skanska, and Rockwool outweighed a sales beat from L’Oreal.
The pan-European STOXX 600 hovered flat by 0825 GMT, in line with the DAX, while the FTSE 100 and CAC 40 managed to inch up 0.2 percent.
French Cosmetics giant L’Oreal said strong demand for luxury skin creams helped it beat fourth-quarter sales forecasts – another company reporting better-than-feared demand from China after LVMH last week.
Its shares rose 1.2 percent in early deals before giving back gains to trade up just 0.4 percent. Traders put the move down to profit-taking after a strong run – L’Oreal hit a record high on Feb 5.
Luxury handbag maker Hermes topped the CAC 40 with a 1.5-percent gain after it also said sales momentum in its Chinese stores stayed strong.
Luxury rivals Kering and LVMH also rose 0.6 percent each.
Swedish electronics group Dometic shone, topping the STOXX with a 16-percent jump after reporting fourth-quarter profit rose and giving a positive outlook for 2019 sales growth.
On the flipside, Belgian chemicals and cobalt refiner Umicore fell 4.7 percent after saying it expected 2019 growth to be hit by subdued demand in cars and consumer electronics, and R&D costs.
Construction was a weak spot with Denmark’s Rockwool sinking 13 percent after full-year earnings missed expectations, and Sweden’s Skanska losing 7.8 percent after it cut its dividend and lagged profit estimates.
Autos fell 0.8 percent, extending losses from Thursday when the sector suffered its biggest one-day drop since the Brexit vote aftermath in June 2016.
Tata Motors warned Jaguar Land Rover would swing to a loss due to weak sales, and that latest negative news on car demand weighed on auto suppliers Valeo and Faurecia, down 2.6 to 3 percent.
(Reporting by Helen Reid; editing by Josephine Mason)