European equity rally pauses as weak results curb demand

martes 27 de enero de 2015 04:41 GYT
 

* FTSEurofirst 300 flat after 8-day rise

* Siemens, Ericsson, Philips lead falls after weak updates

By Francesco Canepa

LONDON, Jan 27 (Reuters) - European shares were little changed on Tuesday as disappointing updates by companies like Siemens and Ericsson raised concern about the coming earnings season and weakened demand for stocks after an eight-day rally.

Shares in Siemens fell 1.9 percent after it said profit from its industrial units dropped 4 percent last quarter, led by a drop at its power and gas unit, and its healthcare unit.

Telecoms network supplier Ericsson was down 3.3 percent after it reported fourth-quarter sales below expectations on Tuesday and said it expected business in North America to remain slow.

Dutch healthcare and lighting company Philips shed 3.5 percent as it cut its 2016 sales and earnings estimates after a "setback" in 2014.

At 0826 GMT, the FTSEurofirst 300 index of pan-European shares was flat at 1,487.70 points. The index had risen nearly 10 percent over the past eight sessions on expectations of monetary stimulus from the European Central Bank. The ECB announced that stimulus last Thursday.

"Today's earnings show that global demand remains the big issue," said Hampstead Capital LLP hedge fund manager Lex van Dam. "Companies can take advantage of low rates, they can buy back stock, but they cannot create demand."   Continuación...