UPDATE 2-European stocks slip from record highs as focus shifts to earnings

  • Reuters
  • Stock Market News
UPDATE 2-European stocks slip from record highs as focus shifts to earnings
Credit: © Reuters.

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* French utilities Veolia, Suez jump on M&A deal

* Airlines easyJet, Ryanair slip on HSBC downgrade

* Stocks globally ease ahead of earnings

* Automakers in a bright spot (Adds comment, details; updates prices)

By Sruthi Shankar and Medha Singh

April 12 (Reuters) - European stocks fell on Monday from all-time highs as investors booked profits ahead of the quarterly corporate earnings season, while two French utility companies surged on news of a merger deal after months of wrangling.

Shares of Veolia VIE.PA and Suez SEVI.PA surged 9.7% and 7.7% after the waste and water management companies agreed on a merger deal worth nearly 13 billion euros ($15.4 billion). benchmark pan-European STOXX 600 index .STOXX ended about 0.5% lower after closing at a record high on Friday, with technology .SX8P , travel and leisure .SXTP and commodity .SXRP stocks leading declines.

Wall Street's main indexes also inched lower as investors awaited economic data and the start of U.S. corporate earnings season that could justify the sky-high valuations. MKTS/GLOB

European earnings will kick into higher gear later in April, with analysts expecting a 47.4% jump in first-quarter earnings for STOXX 600 companies, according to Refinitiv IBES data. Much of the support is likely to come from consumer cyclicals and industrial firms.

UK's domestically focused FTSE mid 250 index .FTMC dropped 0.4%, hovering just below a record high as shops, pubs, gyms and hairdressers reopened after three months of lockdown. the UK, the rapid vaccine roll-out and the sharp fall in infections is clearly reassuring," said Rupert Thompson, chief investment officer at Kingswood in London.

"Even so, the speed of the forthcoming recovery remains uncertain."

Bets on a global economic rebound, fuelled by heaps of stimulus, helped the STOXX 600 finally reclaim its pre-pandemic highs last week, with its recovery hampered by slow vaccine distributions and a new wave of infections in the continent.

The U.S. benchmark S&P 500 .SPX had made up all of its coronavirus-driven losses by last August.

Low cost airlines easyJet EZJ.L and Ryanair RYA.I dropped 3.9% and 3.6% after HSBC downgraded the stocks to "hold" on concerns over a return in demand as the economy reopens. diagnostics group DiaSorin SpA DIAS.MI jumped 9.6% after it said it will acquire U.S. based Luminex Corp LMNX.O for $1.8 billion. sensitive automakers .SXAP were the top-performer among the European stock sectors.

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