Off The Wire
Inflation jitters take toll on European stocks ahead of earnings
Oct 12 (Reuters) - European shares slipped on Tuesday as investors feared that soaring commodity prices would hamper a recovery in corporate profit.
The pan-European STOXX 600 index (.STOXX) was down 0.1%, hovering about 4% below its August peak. Worries about a fallout from China's struggling property sector also remained after Evergrande (3333.HK) missed its third round of bond payments in three weeks.
"The energy crisis is showing no signs of abating, which means considerable cost pressures on companies, and consumers facing the prospect of having less money in their pocket to spend on products and services, thereby having a negative effect on the economy," said Russ Mould, investment director at AJ Bell.
Along with major central banks considering withdrawal of stimulus, expectations for the earnings season have been clouded. The International Monetary Fund on Tuesday trimmed its 2021 global growth forecast to 5.9% from a previous estimate of 6.0%. read more
Germany's DAX (.GDAXI) extended losses to a third straight session, down 0.3%. The ZEW indicator of economic sentiment in the country slipped for the fifth month in a row - the latest in a string of indicators showing supply bottlenecks holding back recovery in the continent's largest economy.
The STOXX 600 is nearly flat on the month, in percentage terms, after shedding 3.4% in September. It is up about 14% so far in 2021.
Freight forwarder DSV (DSV.CO) inched up 1.6% after it raised its earnings expectations for the year, citing brisk business activity in the third quarter and continued tight capacity in the market.
Automakers (.SXAP) were down 0.3% as data showed auto sales in China - a major trading partner of Europe - slumped 19.6% in September as a prolonged global shortage of semiconductors and a domestic power crunch disrupt production.