European shares dipped on Thursday, weighed down by a number of poorly received earnings updates and after data showed that euro zone factory output unexpectedly fell last month. The pan-European STOXX 600 index was down 0.1 per cent at 0943 GMT, while Germany's DAX was up 0.3 per cent and France's CAC 40 was flat.

Euro zone factory output slammed into reverse last month as activity in Germany declined again amid trade tensions and struggles in the auto sector, surveys showed. “There is still widespread concern about how well the economy in Europe has been performing in recent months,” said Michael Hewson, chief market analyst at CMC Markets.

The STOXX 600 however remained just below its highest level in more than 4 months on optimism over progress in China-US trade talks. The index is up 10 per cent so far this year. A Reuters report said Washington and Beijing had started to outline commitments on the stickiest issues in their trade dispute, marking the most significant progress yet toward ending a seven-month trade war.

Moeller-Maersk was the top STOXX 600 loser, down 11 per cent after the Danish shipping group forecast that 2019 profits would miss analysts' expectations. Centrica fell 10.5 per cent after it warned a national price cap on energy bills would hit its 2019 results, while TechnipFMC tumbled 8 per cent as the oil services company posted a fourth quarter loss.

Siltronic fell 8.8 per cent after the Silicon wafer company cut its 2019 core profit margin guidance. Prysmian was another heavy faller, sliding 9.6 per cent, after the Italian cable maker said a system failure was detected in its Westernlink Interconnection.

Banks were the biggest sectoral losers, down 1.2 per cent. Swedbank, 7.8 per cent lower, added to heavy losses from a day earlier when a report linked one of the biggest lenders in the Baltic countries to a regional money laundering scandal involving Danske Bank. Barclays outperformed its sector, up 3.2 per cent.

Even though the UK bank reported a lower than forecast attributable profit, it did show signs of progress in its under-pressure investment bank, where profit for the full year increased as its equities trading unit saw income rise 25 per cent. Still in the UK, BAE Systems fell 6.7 per cent. Britain's biggest defence company said German moves to block exports to Saudi Arabia could hit its major deals with the Kingdom.

comment COMMENT NOW