European stocks pull back from Greece-inspired gains

Big 5

European stocks sagged Tuesday, with energy shares falling after Iran reached a historic nuclear deal and as cautiousness set in over Greece’s bailout deal.

The Stoxx Europe 600 SXXP, -0.30% was off 0.4% at 394.98, in part as the energy group SXEP, -0.71% tracked a nearly 2% fall in oil prices CLQ5, -1.99% The decline came as top diplomats said a nuclear accord has been signed between Iran, the U.S. and five other world powers after days of often acrimonious talks.

The pressure on oil prices stems from expectations that Iranian oil exports will double at a time of oversupply. Among oil producers, Tullow Oil PLC TLW, -4.10% fell 2.2%, Austria’s OMV AG OMV, -1.45% lost 1.5% and Portugal’s Galp Energia GALP, -2.14% fell 2.1%.

Stocks: European equities were pulling back from strong gains made Monday, which came after Greece reached a reform deal with the eurozone to unlock further financial aid. The reform measures must still be approved by Greek lawmakers as well as by other European parliaments before a formal bailout decision can be made.

On Tuesday in Frankfurt, the DAX 30 DAX, -0.52% lost 0.3% to 11,44.77. In Paris, the CAC 40 PX1, -0.23% lost 0.2% at 4,991.06.

Spain’s IBEX 35 IBEX, -0.59% fell 0.3% to 11,181.40, and Italy’s FTSE FTSEMIB, -0.98% gave up 0.7% to 23,009.37.

The U.K.’s FTSE 100 UKX, -0.35% was fractionally lower at 6,737.55.

Greece: Greek Prime Minister Alexis Tsipras must get approval from his government for the austerity measures, which are tougher than the conditions rejected by Greek voters in a July 5 referendum. The reforms must then be passed by the Greek parliament no later than Wednesday.

“Despite the agreement, we would continue to place a 30% probability of a Grexit over the next year,” wrote Credit Suisse analyst Andrew Garthwaite in a note. That is partly due to the challenge Greece faces in implementing the measures, even if they do pass through national parliaments, he said.

Equity trading in Greece GD, +2.03% remains closed, as do the country’s banks.

source:Market watch

Comments
Loading...