European Stocks Decline for a Sixth Day

European stocks dropped for a sixth day, for the longest losing streak since March, after Ben S. Bernanke gave no hint that the central bank will unveil a new round of stimulus. U.S. futures and Asian shares retreated.

U.K. stocks extended their loses as Moody’s Investors Service said the country’s Aaa debt rating would be at risk if the government misses its debt reduction targets. Kabel Deutschland Holding AG (KD8), Germany’s largest cable operator, slumped 4.7 percent after reporting a full-year loss. EON AG and RWE AG both climbed more than 1 percent after Morgan Stanley upgraded its stance on Germany’s two biggest utilities.
The Stoxx Europe 600 Index slid 1 percent to 269.18 at 10:33 a.m. in London. Europe’s benchmark measure has fallen 7.6 percent since this year’s high on Feb. 17 and is trading at about 12.9 times its companies’ reported earnings, near its cheapest valuation since April 2009, according to data compiled by Bloomberg. Futures on the Standard & Poor’s 500 Index expiring in June slipped 0.4 percent today. The MSCI Asia Pacific Index declined 0.4 percent.

Monetary StimulusFederal Reserve Chairman Bernanke said yesterday that the “uneven” and “frustratingly slow” economic recovery merits continued record monetary stimulus. He gave no indication that the central bank plans a third round of asset purchases known as quantitative easing, nicknamed “QE3” by investors.

European stocks extended their losses after Moody’s said that the U.K. could lose its Aaa rating if the government misses its target to reduce debt as the economy slows.

BP Plc (BP/) slid 1.5 percent to 441.4 pence, dragging the Stoxx 600 lower, as investors speculated that OPEC will increase its production quotas at its meeting in Vienna today. CGGVertias, the world’s biggest surveyor of oilfields, lost 3.5 percent to 24.90 euros in Paris. TGS Nopec Geophysical Co. ASA, the Norwegian oil surveyor, dropped 2.5 percent to 142.10 kroner.
EON, the Dusseldorf, Germany-based power producer, rose 1.6 percent to 19.30 euros after Morgan Stanley raised its rating to “overweight” from “underweight.”
Pandora A/S gained 1.8 percent to 166.90 kroner. The Danish maker of jewelry may buy back its own stock to stop the selloff in its shares and squeeze investors who have shorted the company, Borsen reported. Pandora has slumped 50 percent this year.

Source: www.bloomberg.com

Ravi Jhawar
Summer Intern-Technical Analyst
DENIP Consultants Pvt. Ltd.