Tuesday, 14 July 2015 16:43
LONDON: European stocks edged down on Tuesday after a four-day rally, with weaker oil prices weighing on energy shares after a landmark nuclear deal on Iran which could see sanctions on its oil exports lifted.
The STOXX Europe 600 Oil & Gas Index fell 0.7 percent with the broader pan-European STOXX 600 index showing a 0.3 percent decline and the FTSEurofirst 300 index retreating 0.2 percent.
Oil prices fell more than $ 1 a barrel after the deal between Iran and six global powers, which would see an easing of sanctions against Tehran and a gradual rise in its oil exports.
A Reuters survey of analysts had said Iran would increase oil exports by up to 60 percent within a year if a nuclear agreement was reached.
“A key question is now how quickly supply will now come online,” Ashburton European equity fund manager, Veronika Pechlaner, said.
“The Iran deal was well advertised in advance, so it shouldn’t come as a huge surprise. But it will take a few quarters to know the longer term effects.”
The FTSEurofirst’s pullback came after a gain of about 9 percent over the last week on hopes of a Greek debt deal. However, just hours after signing up to an austerity package in return for agreeing to talks on an 86 billion euro bailout, doubts were already emerging about whether Greek Prime Minister Alexis Tsipras would be able to hold his government together.
The euro zone’s Euro STOXX 50 index slipped 0.4 percent after hitting a two-week high on Monday, while German utility RWE was among the worst-performers, falling 3.3 percent after UBS downgraded RWE to “sell” from “neutral”.
Among standouts, Norwegian non-life insurer Gjensidige rose 3.3 percent after its earnings beat expectations, while Switzerland’s Kuehne und Nagel also climbed on the back of a rise in its earnings.
The FTSEurofirst 300 is up about 15 percent since the start of 2015, with the Euro STOXX 50 up 14 percent.
Today’s European research round-up
