European shares dip as US tax bill gets muted reception
LONDON (Reuters) – European stocks followed Wall Street and Asian bourses lower on Thursday in a muted response to the US Congress’s approval of a long-anticipated tax overhaul.
The pan-European STOXX 600 index was down 0.2 percent, with major European bourses trading sideways.
The Spanish government hopes a regional election will strip pro-independence parties of their control of the Catalan parliament.
Describing the muted market reaction to the US 1.5 trillion dollar tax bill, Henry Croft of Accendo Markets described “a widely touted ‘buy the rumour, sell the fact’ event” and said investors were now focused on whether the tax reform would boost equities in 2018.
Other analysts believe investors will need time to crunch the data and figure out which companies will benefit the most.
“As people sharpen their pencils and figure out which companies will benefit (from the tax bill), and companies start talking about that themselves, I think we’ll see larger moves in share prices,” said John Carey, portfolio manager at Amundi Pioneer Asset Management in Boston.
Britain’s Balfour Beatty BALF. added a 2.4 percent rise after it said on Thursday it had agreed to sell a 12.5 percent stake in M25 motorway operator Connect Plus for 103 million pounds ($137.6 million), helping push up 2017 profit and generating funds to pay down debt.
Scandal-hit Steinhoff (SNHG.DE) posted the worst fall, down 12.6 percent and hitting a low 0.26 euro.
Still in banking, Deutsche Bank (DBKGn.DE) lost 1.5 percent. It said on Wednesday it would aim to cut up to 1,000 jobs as part of the planned integration of retail arm Postbank.
Energy was the only sector trading in the black with Norway’s Statoil (STL.OL) rising 0.6 percent after presenting plans to extend output from the North Sea Snorre oilfield.
Heavily indebted telecoms and cable group Altice (ATCA.AS), also made it to the top risers of the session. Citigroup analysts lowered their price target but kept an overall “buy” rating on the stock, which has slumped nearly 60 percent so far in 2017 due to concerns over its 50 billion euros debt pile.