European stocks erased their decline in the final half an hour of trading, leaving the Stoxx Europe 600 Index little changed at its highest level in a month.
Commodity producers slid as the release fueled concern about the slowdown in the world’s second-biggest economy. Burberry Group Plc (BRBY) gained 4.8 percent after the company’s spring-summer collection helped increase retail sales in its fiscal first quarter by more than analysts had estimated. Tryg A/S (TRYG) added 3.3 percent after posting better-than-forecast pretax profit as cost cuts offset increased weather-related claims.
The Stoxx 600 added 0.1 percent to 294.84 at the close of trading. The gauge earlier lost as much as 0.5 percent as a report showed China’s exports and imports unexpectedly dropped. The equity benchmark climbed yesterday after Alcoa Inc. started the U.S. earnings-reporting season by posting profit and sales that exceeded analysts’ estimates. It has advanced 5.4 percent so far this year.
“China’s trade data showed unexpected declines in both exports and imports, adding to concerns that the slowdown in China is intensifying amid weakness in both external and domestic demand,” Gary Dugan, Coutts & Co.’s Singapore-based chief investment officer, wrote in a note. “This will test how far the government is willing to sacrifice weak near-term growth for the sake of its longer-term policy objectives.”
A report from the General Administration of Customs in Beijing showed that China’s exports fell 3.1 percent in June from a year earlier. The median estimate in a Bloomberg News survey had called for a 3.7 percent gain. Imports dropped 0.7 percent last month, compared with the median projection of a 6 percent increase.
In the U.S., the Federal Reserve releases the minutes of its June meeting at 2 p.m. in Washington today. Speaking after that meeting, Chairman Ben S. Bernanke said the central bank may reduce the pace of its $85 billion in monthly bond buying later in 2013, and may halt purchases in the middle of 2014 if the U.S. economy performs as the Fed forecasts.
National benchmark indexes fell in 10 of the 18 western-European markets today. The U.K.’s FTSE 100, Germany’s DAX and France’s CAC 40 all slipped 0.1 percent.
Italy’s FTSE MIB Index declined 0.7 percent after S&P lowered the nation’s credit rating to BBB, or two levels above junk. The company cited expectations of a weakening economy and financial system. A report today showed Italian industrial production rose in May less than economists had predicted. Output dropped in February, March and April.
An index of European mining stocks retreated the most among the 19 industry groups on the Stoxx 600 after yesterday completing its biggest two-day advance in two months. Commodity companies have lost 27 percent so far in 2013 and completed their worst first half since 2000 in June.
K+S AG decreased 4 percent to 27.19 euros after UBS downgraded Europe’s largest potash maker to sell from neutral. Analysts led by Joe Dewhurst predicted that declining earnings will reduce cash returns to investors until 2018.
G4S Plc (GFS) dropped 1.7 percent to 225.6 pence. Goldman Sachs Group Inc. reiterated its “conviction sell” recommendation on the provider of security services, citing continued pressure on its profit margin in the second quarter.
Gagfah SA slumped 6.5 percent to 8.75 euros, its biggest decrease in 18 months. Germany’s second-biggest residential landlord said it sold 9.5 million new shares and 10.5 million existing treasury shares at 8.85 euros apiece. Fortress Investment Group LLC sold 20 million shares in the company, taking its stake to about 49 percent, according to a statement.
Gerresheimer AG fell 2.7 percent to 43.55 euros. The maker of medicine bottles, vials and syringes forecast a margin on earnings before interest, taxes, depreciation and amortization of 19 percent to 19.4 percent for the full year, compared with a previous projection of 19.4 percent in April.
Burberry, the U.K. luxury-goods maker known for its trench coats, advanced 4.8 percent to 1,509 pence. Retail sales increased to 339 million pounds ($506 million) in the three months ended in June, more than the 316 million-pound median estimate of analysts surveyed by Bloomberg.
Tryg added 3.3 percent to 507.50 kroner. The Danish property and casualty insurer posted second-quarter profit before taxes of 688 million kroner ($118 million), more than the average analyst estimate of 598 million kroner.
Software AG jumped 6.6 percent to 25.05 euros, its largest increase in almost nine months, as brokers at Barclays Plc and Morgan Stanley upgraded their ratings on the maker of enterprise software. The shares slumped 27 percent from the beginning of this year through yesterday.
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