UPDATE 1-European mining and energy share indexes slump to 12-year lows

miércoles 20 de enero de 2016 07:21 GYT
 

(Adds short interest data, details, quotes)

By Atul Prakash

LONDON Jan 20 (Reuters) - European basic resources and energy share indexes slumped to their lowest levels in more than 12 years on Wednesday, with a sharp decline in oil and metals prices scaring investors away from commodities stocks.

The STOXX Europe 600 Basic Resources index fell 4 percent, while the region's oil and gas index slipped 3.8 percent, with both touching their lowest levels since 2003.

Shares in commodities-related companies such as BHP Billiton , Anglo American, Glencore and Royal Dutch Shell fell 5.7 percent to 6.9 percent.

"We do not see any lasting potential for these sectors to outperform and believe any recovery might be short-lived," Christian Stocker, equity strategist at UniCredit, said.

"The trend of earnings estimates is declining strongly, relative valuation versus the overall market is still very high, and a lasting trend reversal in commodity prices is not in sight. We recommend remaining underweight on commodity stocks."

Mining and energy stocks have been hit by a slowdown in China, which is the world's second-biggest economy and a major global consumer of metals and oil.

According to Thomson Reuters Datastream, the basic resources and oil and gas indexes trade on 13.5 times and 13.9 times respectively their 12-month forward earnings, against 14.2 times for the broader STOXX Europe 600 index.   Continuación...