European shares fall for second day, led by techs

jueves 26 de marzo de 2015 11:18 GYT
 

* FTSEurofirst 300 down 1.3 pct, extends Wednesday retreat

* Euro zone stocks hit as euro regains more ground

* Decline seen as profit taking; medium-term trend intact

By Blaise Robinson

PARIS, March 26 (Reuters) - European stocks fell on Thursday, extending the previous session's retreat, hurt by worries over valuation levels in growth sectors such as technology as the euro currency regained more ground.

Shares in Nokia, Alcatel-Lucent, STMicroelectronics, ARM, and ASML were down 2.9 percent to 5.5 percent, mirroring a similar decline in U.S. tech shares on Wednesday.

Shares in European tech firms -- seen as benefitting significantly from the drop in the euro currency over the past year -- had surged 42 percent since mid-October, outpacing the overall market and sending the sector to valuation ratios well above long-term averages.

The sector trades at 20.4 times expected earnings in the next 12 months, above a 10-year average of 16.2 times, while the broad STOXX Europe 600 index currently trades at 16 times expected earnings, according to Thomson Reuters Datastream.

"With the euro bouncing back and with stock indexes near seven-year highs, investors are starting to think that a lot of positive news is already reflected in lofty valuation levels and that it's time to book some profits," Barclays France director Franklin Pichard said.   Continuación...