EUROPE MARKETS: European Stocks Slump After Earnings Deluge

By Sara Sjolin, MarketWatch

Eurozone PMI confirms flash reading

European stock markets moved sharply lower on Wednesday, as investors assessed a mixed bag of corporate news, with shares of Dialog Semiconductor PLC and London Stock Exchange Group PLC tanking around 10%.

After a wobbly start to the day, the Stoxx Europe 600 index slid 0.9% to 332.52, setting it on track for a fourth straight session of losses. The pan-European benchmark on Tuesday dropped to its lowest close in three weeks, as the euro hit a roughly nine-month high against the dollar.

The shared currency was largely flat at $1.1503 on Wednesday, leaving corporate updates to dictate the trading action.

Earnings deluge: Shares of Dialog Semiconductor (DLG.XE) topped the list of decliners in the Stoxx 600, slumping 12%. The big loss came after the maker of chips used in Apple (AAPL) and Samsung Electronics (005930.SE) smartphones reported a sharp drop in underlying first-quarter profit.

London Stock Exchange Group (LSE.LN) lost 9.2% after Intercontinental Exchange Inc.(ICE) said it doesn't intend to make an offer for the U.K. exchange operator.

BHP Billiton PLC (BLT.LN) (BHP.AU) (BHP.AU) slid 6.8% after Brazilian federal prosecutors on Tuesday filed a civil lawsuit demanding (http://www.marketwatch.com/story/mining-firms-bhp-vale-face-44b-lawsuit-in-brazil-2016-05-03) that mining companies responsible for a catastrophic dam failure in November pay up to 155 billion reais ($43.55 billion) for cleanup and remediation.

Also in London, supermarkets were among biggest fallers after a report that the top four U.K. grocers continued to lose market shar (http://www.marketwatch.com/story/top-four-uk-grocers-lose-market-share-2016-05-04)e to German discount retailers Aldi and Lidl. Shares of Wm. Morrison Supermarkets PLC (MRW.LN) lost 2.5%, Tesco PLC (TSCO.LN) (TSCO.LN) dropped 3.4% and J Sainsbury PLC (SBRY.LN) slid 5.1%. Sainsbury's also reported a swing to pretax profit for fiscal 2016, but cut its dividend (http://www.marketwatch.com/story/sainsbury-cuts-dividend-payout-2016-05-04).

Air France-KLM (AF.FR) dropped 5% after posting a loss for the first quarter (http://www.marketwatch.com/story/air-france-klm-loss-narrows-2016-05-04-14854153). The Franco-Dutch airline said, however, lower fuel costs had helped earnings during the period.

Anheuser-Busch InBev NV (ABI.BT) lost 2.4% after the brewer said unfavorable currency effects damaged net profit (http://www.marketwatch.com/story/ab-inbev-profit-dips-on-currency-factors-2016-05-04-14854138) in the first quarter of the year.

On a more upbeat note, A.P. Moeller-Maersk (MAERSK-B.KO) jumped 6.2% after the Danish oil and shipping conglomerate reported earnings ahead of forecasts (http://www.marketwatch.com/story/maersk-profit-sinks-on-freight-rates-crude-prices-2016-05-04).

German engineering giant Siemens AG (SIE.XE) (SIE.XE) gained 1% after its second-quarter earnings beat analyst expectations (http://www.marketwatch.com/story/siemens-profit-beats-forecasts-2016-05-04-1485352).

Société Générale SA (GLE.FR) picked up 3.4% after the French bank reported an increase in first-quarter net profit (http://www.marketwatch.com/story/societe-generale-profit-boosted-by-retail-banking-2016-05-04), boosted by its retail banking performance.

Indexes: Germany's DAX 30 index fell 0.7% to 9,859.16, while France's CAC 40 index erased 0.7% to 4,339.85.

The U.K.'s FTSE 100 index lost 1.3% to 6,107.22 (http://www.marketwatch.com/story/ftse-100-on-track-for-third-straight-loss-as-bhp-sainsburys-weigh-2016-05-04), driven lower primarily by the miners and supermarkets.

Economic news: The final composite purchasing managers index for the eurozone in April was in line with the flash reading at 53. That's down a bit from 53.1 in March and still above the 50 level that signals expansion in the economy.

The services PMI for the bloc slipped to 53.1 from the flash estimate of 53.2, matching the March reading of 53.1.

Retail sales in the eurozone fell sharply in March (http://www.wsj.com/articles/eurozone-retail-sales-fell-sharply-in-march-1462352401#:i22zkQvozAQd0A), down 0.5% from February, according to data from Eurostat.

(END) Dow Jones Newswires

May 04, 2016 08:43 ET (12:43 GMT)

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