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* ARM rises over 40 percent after Softbank bid
* Sector peers Dialog, AMS also among top gainers
* But Turkey unrest weighs on BBVA and TUI
By Sudip Kar-Gupta
LONDON, July 18 (Reuters) - European shares slipped on Monday, as concerns over unrest in Turkey weighed on some travel and financial stocks exposed to the country, although tech stocks rose after a bid for Britain’s ARM.
The pan-European STOXX 600 index was down 0.1 percent going into the close of the trading session.
Tour operators Thomas Cook and TUI both fell more than 2 percent, as analysts saw an attempted coup in Turkey as hitting tourism companies for whom Turkey is a key holiday destination.
The unrest in Turkey also weighed on Spanish bank BBVA , whose shares fell due to BBVA’s exposure to the country via its stake in Turkish bank Garanti.
However, shares in British technology group ARM surged by more than 40 percent after Japan’s SoftBank agreed to buy the chip designer in a 24.3 billion pound ($32.2 billion) deal.
ARM’s peers, such as Dialog Semiconductor, AMS and Infineon also climbed, enabling the STOXX Europe 600 Technology sector to outperform with a 3.1 percent rise.
Last month’s shock vote in Britain in favour of quitting the European Union has pushed sterling down to its lowest level in more than three years against the yen, thereby making ARM more attractive to SoftBank.
Shares in ARM, which derives most of its earnings in U.S. dollars, have also risen steadily since last month’s “Brexit” vote.
However, Morgan Stanley’s strategists kept an “underweight” position on European stocks due to June’s Brexit vote.
“We see no reason to change our current underweight view on European equities after the UK’s recent vote to leave the EU, ushering in a period of high uncertainty that is likely to persist through 2017 and dampen the growth outlook and equity valuations,” they wrote in a research note.
Yet Phoebus Theologites, co-founder of multi-fund investment company SteppenWolf Capital, said pledges to support the market by the European Central Bank would continue to keep European stock markets propped up.
“The explicit stance and rhetoric of the ECB continues to support risk assets and suppress volatility,” he said. (Additional reporting by Alistair Smout; Editing by Jason Neely and Mark Potter)