Askume, Sept 20 – European stocks fell on Friday after gaining in the previous session on the Federal Reserve’s sharp interest rate cut, while Mercedes’ share price fell to its lowest in 15 months after the automaker cut its headline profit forecast in a bad day.
The pan-European STOXX 600 index (.STOXX) was down 0.4% at 519.76 by 0805 GMT , but was expected to post a second consecutive week of gains.
All major European markets were lower except Spain (.IBEX) , which was up 0.1%.
Automobile stocks (.SX8P) led the sector down 2.9%, hurt by Mercedes-Benz(MBGN.DE) fell 7.6% as the company cut its full-year profit margin for the second time in less than two months due to a drop in overall sales in China.
Mercedes also weighed on Germany’s benchmark index (.GDAXI) , which fell 0.8%. German producer prices fell less than expected in August, falling 0.8% year-on-year, while expectations were for a 1% drop.
Jefferies said the luxury goods market will not see a significant recovery in the second half of the year, with the European luxury goods industry (.STXLUXP) declining more than 2%.
Technology stocks (.SX8P) fell 1.1% and personal products stocks (.SXQP) dropped 1.5%.
Britain’s FTSE 100 index (.FTSE) fell 0.5% after a survey showed consumer confidence fell sharply to a six-month low.
“Consumers were less confident about their personal finances in September than in August, and they were less likely to make a large purchase compared to the previous month,” said Kathleen Brooks, research director at XTB.
“What is worrying for the government is that consumer opinion on the economic outlook also deteriorated sharply in September.”
UK retail sales rose 1% in August , higher than expected, while sales are expected to have risen 0.4% from July, boosting the pound.
Investors will now turn their attention to euro zone consumer confidence data for September, due at 1400 GMT, for more clues on the health of the region’s economy.
Among other drivers, Novo Nordisk (NOVOb.CO) rose 0.5% after the European Medicines Agency backed the use of the Danish drugmaker’s popular drug Wegovy to help reduce heart failure in obese patients .
Britain’s Burberry (BRBY.L) fell 4.6% after Jefferies downgraded the stock to “underperform” from “hold” and cut its price target to 490 pence from 800 pence.
