European stocks wobble as car makers slump

European stocks finished a choppy session almost flat, with a rally for banks and commodity shares offset by a slump for auto makers after a round of broker downgrades.

The Stoxx Europe 600 ended down 0.01 point at 334.72, after trading as high as 338.73 earlier in the session.

Basic material shares helped keep the pan-European benchmark out of deep negative territory, finding support from a softer U.S. dollar DXY, -0.15% which tends to help prices for metals and oil for holders of other currencies. Oil prices  moved closer to $50 a barrel, after gaining on Monday as Goldman Sachs said the global oil market likely shifted into a deficit in May. Metals were also mostly higher.

Movers: In the mining group, Anglo American PLC added 3.2% and Rio Tinto PLC climbed 1.1%.

Among financials, Greece’s Alpha Bank popped up 5.5%. That followed a ratings upgrade to buy from neutral at UBS. The stock is trading “at no premium to its peers, despite, in our view, higher operational efficiency and superior profitability, and for Alpha a premium is justified,” said UBS analysts Mate Nemes and Margarita Streltses in a note.

Meanwhile, the International Monetary Fund wants the eurozone to let debt-burdened Greece skip paying interest or principal on bailout loans until 2040, officials familiar with the talks told The Wall Street Journal.

Greece’s Athex Composite tacked on 1% to 626.37, with shares of Eurobank Ergasias SA up 2.9%.

Auto blues: Carmakers across Europe posted sharp losses after HSBC cut the sector to underweight from neutral, according to media reports.

Fiat Chrysler Automobiles slumped 6.7% after further being downgraded to underperform from neutral by Exane BNP Paribas.

Peugeot SA lost 4.1%, Renault SA fell 3.1% and BMW AG slid 3%.

Indexes: U.K’s FTSE 100  gained 0.3% to 6,167.77, with Taylor Wimpey PLC shares up 4.7% as the home builder raised its dividend payout policy.

Germany’s DAX 30 fell 0.6% to 9,890.19. Trading was closed yesterday for the Whit Monday holiday.

France’s CAC 40 dropped 0.3% to 4,297.57.

The euro was up 0.2% at $1.1340.

Source: MarketWatch

 

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