Europe Stocks Slip After Moody’s Warning

Most European stock markets dropped on Tuesday, after Moody’s Investors Service cut the outlook on the European Union to negative and warned that the region could lose its Aaa debt rating.

The Stoxx Europe 600 index SXXP fell 0.4% to 267.50, pulling back after the index on Monday posted its best performance in a month.

Among notable movers on Tuesday, Dutch supermarket company Royal Ahold NV AH rose 2.3% as it said it’s exploring strategic options for its 60% stake in ICA AB. See: Ahold explores alternatives for ICA venture

For the downside movers, drug makers added the most pressure on the pan-European index.

Roche Holding AG ROG RHHBY gave up 0.9%, Novo Nordisk AS NOVOB lost 0.7% and GlaxoSmithKline PLC GSK GSK tripped 0.7%.

The broader European stock markets headed south as Moody’s said it needed to adjust its outlook on the EU due to “the likelihood that the large Aaa-rated member states would likely not prioritize their commitment to backstop the EU debt obligations over servicing their own debt obligations.” See: Moody’s warns on European Union debt rating

More movers

Wiireless-telecom firm Vodafone Group PLC VOD  VOD fell 1.3%, as Bernstein Research cut the stock to market perform from outperform, citing “an increasing number of negative operational risks.”

The U.K.’s FTSE 100 index UKX lost 0.4% to 5,734.49.

HSBC Holdings PLC HSBA HBC 5  fell 0.4% and Royal Bank of Scotland Group PLC RBS  RBS gave up 1.3%.

In Germany, Volkswagen AG VOW VOW3 lost 1.4%, weighing on the DAX 30 index DAX, which slipped 0.2% to 6,998.04.

France’s CAC 40 index PX1 tripped 0.2% to 3,445.97.

Marketwatch