By Shubham Batra
(Reuters) – European shares were subdued on Monday as investors await more economic data this week and earnings from some of the highest-valued U.S. companies, along with major European banks and consumer companies.
The pan-European STOXX 600 index was flat as of 0825 GMT, with oil and gas shares falling the most by 0.5%, tracking oil prices, while financial services added 0.7%.
Healthcare shares rose 0.3%, led by Philips NV, which jumped 12.3% after the Dutch health technology group posted better-than-expected first-quarter results.
Investors will closely monitor results of some of the biggest U.S.
companies including Microsoft Corp, Google parent Alphabet Inc and Amazon.com Inc this week.
Back home, big banks Barclays Plc, Santander, Deutsche Bank AG, UBS Group AG, and consumer companies like Nestle SA, Reckitt and Unilever Plc report results this week.
“On one hand, there are worries about recessions, dip in consumer spending and higher interest rates sucking out of the economy.
On the other, you’ve got a more resilient economy than people expected,” said James Baxter, founder of Tideway Wealth.
“It’s a fairly mixed bag at the moment. We’ve got a lot of earnings coming after which we will give a better steer.”
European shares witnessed a healthy run in the last month as fears of a banking crisis abated and companies posted better results than U.S.
peers so far. However, uncertainty over the interest rate outlook continues to mount worries over stocks.
German business morale rose in April, adding to positive signs as Europe’s largest economy hopes to have dodged a winter recession, according to a survey.
Commentary from European Central Bank (ECB) policymakers Fabio Panetta and Francois Villeroy de Galhau will be tracked closely for more clues on the ECB’s monetary tightening path, along with the euro zone’s flash estimates for GDP growth in April.
According to a Reuters poll, the euro zone’s GDP is likely to grow at a slower pace in the March quarter compared to the same period a year ago, while seeing a slight jump in quarterly growth.
Shares of Software AG skyrocketed 49.9% after private equity firm Silver Lake offered to buy the German software developer.
UK’s Medica Group also surged 32.5% after the telemedicine services company recommended a takeover offer from private equity firm IK Investment.
Sweden’s Avanza dropped 7.8% as the financial services provider missed first-quarter profit expectations.
Bed Bath & Beyond Inc’s Frankfurt-listed shares fell 34.6% after the U.S. home goods retailer filed for bankruptcy protection.
(Reporting by Shubham Batra in Bengaluru; Editing by Varun H K and Sonia Cheema)
