(ADVISORY- Follow European and UK stock markets in real time on
the Reuters Live Markets blog on Eikon - see cpurl://apps.cp./cms/?pageId=livemarkets)
* STOXX 600 down 0.4 pct
* Mediclinic jumps 20 pct on regulatory reprieve
* Legal & General hit by underperform rating
* Financials weigh after Deutsche results disappoint
By Helen Reid
LONDON, April 27 European shares retreated from
20-month highs on Thursday with financials and commodity-related
stocks the main drag on the benchmark index.
The pan-European STOXX 600 index was down 0.4
percent in early trading, after having hit a fresh 20-month high
in the previous session. France's CAC 40 also fell 0.5 percent,
just off Wednesday's nine-year high.
First-quarter earnings for STOXX 600 companies are expected
to rise 5.5 percent this reporting season, according to Thomson
Reuters I/B/E/S data. Revenues are expected to increase 5.7
Of the 20 percent of companies having reported so far, 70
percent had beaten estimates while 19 percent had missed,
Thomson Reuters data showed.
Deutsche Bank shares fell 3.5 percent even though
first-quarter net profit more than doubled following a rebound
in bond trading.
Analysts said the bank's revenues, which were down 9 percent
for the quarter, had disappointed.
"We are positive on costs and capital but the key
uncertainty remains revenues. Today’s results confirm this
view we think," said UBS analysts.
Shares of Deutsche Bank have nearly doubled from their Sept
A 4.7 percent drop in Banco Popular shares added to
underperformance in European banks, down 0.3 percent.
However, results from Lloyds boosted the British
bank up 3.8 percent after its first-quarter profit bucked
expectations of a post-Brexit dip.
Insurers were also among the worst-performing sectors,
weighed by Legal & General shares which fell 5 percent
after Credit Suisse gave the insurer an underperform rating, and
Munich Re going ex-dividend.
First-quarter earnings hit by weak margins in its renewable
and retail business dampened appetite for shares in Finnish
energy company Neste which fell 6 percent, dragging
on the broader European energy index.
Shares in aeronuatical company Zodiac Aerospace
hit a year-to-date low, down 4.4 percent after a French media
report which raised doubts on a planned takeover by Safran
Among risers, Mediclinic shares jumped up to 12
percent after the Abu Dhabi government canceled a requirement
for citizens to make a 20 percent co-payment for treatment at
private facilities, in a boon to private healthcare providers.
Elsewhere, upbeat results from the likes of SKF, Nokia and
Subsea 7 were cheered as more investors piled into the European
economic recovery story.
Subsea 7 shares jumped 8.5 percent after the oil
services company raised its forecast for 2017 margins.
Nokia jumped 6.4 percent to a 20-month high after
the telecom networks equipment maker reported a slowing rate of
sales decline, saying the global networks market was recovering.
Swedish industrials company SKF hit its highest
level in nearly two years, up 4.2 percent after it posted
better-than-expected results and a strong guidance for the