European stocks fall on back of poor results

European markets slide further; SAP loses 4.5 per cent as it cuts its profit forecast

A visitor enters an elevator in the lobby at the headquarters of SAP in Walldorf, Germany. The technology company forecast this morning that 2014 underlying operating profit would be €5.6 billion  to €5.8 billion, compared with an earlier projection of as much as €6 billion. Photograph: Krisztian Bocsi/Bloomberg

A visitor enters an elevator in the lobby at the headquarters of SAP in Walldorf, Germany. The technology company forecast this morning that 2014 underlying operating profit would be €5.6 billion to €5.8 billion, compared with an earlier projection of as much as €6 billion. Photograph: Krisztian Bocsi/Bloomberg

 

European stocks fell after worse- than-estimated financial results, while gold and German and British government bonds rose. Asian equities headed for the biggest gain in two years, led by Japan on speculation the country’s public pension fund will buy more domestic shares. The Stoxx Europe 600 Index dropped 0.2 per cent at 9:42 a.m. in London.

SAP fell after cutting its profit forecast and Royal Philips NV slid after profit missed analysts’ estimates. Standard and Poor’s 500 Index futures gained 0.3 per cent.

A 4 percent jump in Japan’s Topix index propelled the MSCI Asia Pacific Index 2.1 per cent higher. Germany’s 10-year bond yield fell three basis points to 0.83 percent and the rate on similar- maturity gilts dropped two basis points to 2.17 per cent. Gold added 0.3 per cent. About $4.3 trillion was erased from the value of global equities in the past four weeks on concern economic growth is slowing.

China’s central bank is planning to inject about 200 billion yuan ($32.7 billion) into lenders as Communist Party leaders gather for a plenum that may further economic and social reforms, according a government official familiar with the matter. Apple Inc. and Halliburton Co. are among US companies reporting earnings today.

“I do not expect a big positive impulse from the current earnings season in Europe,” said Benedict Goette, founder of asset-management company Compass Capital AG in Zurich. “Unless a multiday up-move develops, people will remain nervous. We’re now in the highly volatile phase of attempting to bottom, but I would expect a final bottom only by the end of October or mid- November.” Seventeen of the 19 industry groups in the Stoxx 600 fell. The gauge has dropped for four weeks, the longest streak since June 2013. The index closed at its lowest level of the year on Oct. 16.

SAP lost 4.5 per cent after the world’s largest supplier of business-management software cut its full-year earnings forecast. Royal Philips NV slid 3.9 per cent after third-quarter sales and profit missed analysts’ estimates.

Bloomberg