European Stocks Fail To Hold Gains, Close Weak

European stocks failed to hold early gains and ended weak on Wednesday with the mood turning cautious past mid afternoon as investors awaited some crucial U.S. economic data for more clarity about the outlook for interest rates.

Stocks gained in strength early on in the session, reacting to a slew of strong earnings updates.

Survey data from the ifo Institute showing business sentiment in Germany improved in April also aided sentiment earlier in the day. Germany's business confidence index climbed to 89.4 in April while economists had forecast the score to rise moderately to 88.9 from March's initially estimated value of 87.8.

Confidence among British manufacturers improved in April and their output expectations hit the strongest in six months, the latest quarterly Industrial Trends Survey results from the Confederation of British Industry showed.

The business sentiment indicator rose to +9 percent in the quarter to April from -3 percent in January.

Comments by Joachim Nagel, president of Germany's Bundesbank, at the DZ Bank Capital Markets Conference 2024 that a June interest rate cut from the European Central Bank might not necessarily be followed by a series of rate cuts, hurt a bit.

The pan European Stoxx 600 ended down 0.43%. The U.K.'s FTSE 100, which climbed to a fresh record high, ended down 0.06%. Germany's DAX and France's CAC 40 ended lower by 0.27% and 0.17%, respectively. Switzerland's SMI dropped 0.86%.

Among other markets in Europe, Belgium, Denmark, Finland, Poland, Portugal, Russia, Spain and Sweden ended weak.

Iceland, Norway and Turkiye closed higher, while Austria, Greece and Netherlands ended flat.

In the UK market, Anglo American Plc rallied nearly 4.5%. Reckitt Benckiser gained about 3% as it reported Q1 like-for-like net revenue growth of 1.5 percent.

Rio Tinto gained 2.5%. BAE Systems, IHG, Glencore, Bunzl and Mondi advanced 1 to 2%.

Engineering group Filtronic soared 47% after announcing a strategic partnership and commercial agreement with Space Exploration Technologies Corp.

Croda International ended down 4.8%. Ocado Group, Entain, Persimmon and JD Sports Fashion lost 3 to 3.5%.

Burberry Group, Segro, Spirax-Sarco Engineering, Marks & Spencer, Taylor Wimpey, Relx, Legal & General, Barratt Developments, Schrodders, Land Securities and BT Group also ended notably lower.

In the German market, Infineon climbed more than 5%. Siemens Healthineers, Rheinmetall, Brenntag, Beiersdorf, Continental and Porsche posted moderate gains.

Zalando, Deutsche Boerse, Fresenius Medical Care, Vonovia, Allianz, Deutsche Post, Bayer, Hannover Rueck, Volkswagen, Munich, Fresenius and Daimler Truck Holding lost 1.4 to 4%.

In the French market, STMicroElectronics gained about 5%. Renault moved up more than 2%. Schneider Electric, Dassault Systemes, Legrand, Arcelor Mittal, Thales and Stellantis gained 0.5 to 1.6%.

Eurofins Scientific ended 7.7% down. Kering ended nearly 7% down, after a profit warning and amid concerns about declining demand for its Gucci brand.

Orange, Air Liquide, Alstom, AXA and Sanofi also ended notably lower.

Dutch water processing equipment supplier ASM International soared 11%. The company raised its Q2 revenue forecast after beating analyst estimates for revenue and earnings in the first quarter.

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