Europe midday: Stocks slip ahead of US labour market indicators

by | Jun 3, 2021

European stocks were slipping lower shortly after midday as investors stayed on the sidelines ahead of two closely-followed US labour market indicators.
“After hitting fresh record highs earlier in the week, European bourses are edging lower on Thursday as investors digest upbeat European PMIs and look cautiously ahead to a US data deluge,” said Sophie Griffiths, Market Analyst, UK&EMEA, OANDA.

US consultancy ADP’s private sector payrolls report was due out at 1315 BST, followed by initial weekly unemployment claims figures at 1330 BST.

Against that backdrop, the pan-European Stoxx 600 index was down 0.56% to 448.82 with regional bourses all lower.

Spain’s Ibex 35 was the weakest, retreating 0.78% to 9,109.5, alongside a 0.61% drop for the German Dax to 15,507.37.

Nevertheless, there was some good news to be had.

IHS Markit’s final reading of May services sector activity in the euro area printed ahead of forecasts at 57.1, versus a preliminary reading of 56.9 and up significantly from April’s print of 53.8.

Commenting on the implications of those survey results, economists at Barclays Research reiterated their forecast for euro area gross domestic product growth of 1.0% quarter-on-quarter over the three months to June and of 2.8% in the third quarter.

In equity news, discount retailer B&M European Value Retail fell after it warned 2022 UK revenues would be lower against tough comparatives as it reported better-than-expected annual profits.

UK telecoms company BT Group was knocked lower by a downgrade to ‘sell’ from ‘hold’ at Deutsche Bank, while Experian lost ground after a downgrade to ‘underperform’ at RBC Capital Markets.

French spirits group Remy Cointreau plummeted as it topped estimates for full-year operating profit growth with investors in turn relishing an 85% rise in dividends.

French construction materials group Saint-Gobain was up more than 4% after forecasting record operating income and margin in the first half of the year.

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