Europe open: Shares lower on caution; Worldline surges on results

28th Feb 2024 08:17

(Sharecast News) - European stocks were slightly lower at the open on Wednesday as investors stayed cautious ahead of a US inflation reading on Thursday.

The pan-regional Stoxx 600 index was down 0.04% at 496.14 in early deals with major bourses mixed. Thursday will see the release of US personal consumption expenditure data, seen by the country's central bank as a key measure of inflation.

Investors were also eyeing news from China as real estate developer Country Garden faced a liquidation petition from creditor, Ever Credit Limited.

"The development threatens to reignite concerns about the fragility of the sector and cast doubt on efforts made by authorities to shore it up and stop contagion," said Hargreaves Lansdown analyst Susannah Streeter.

"It's clear there is no easy exit from the debt quagmire these companies are mired in, and it indicates that restoring confidence to the sector is going to be a drawn-out process. The longer it goes on, and property values stay depressed, it is also likely to affect consumer wealth perceptions and continue to act as a drag on the wider Chinese economy."

"Iron ore prices, which had been resilient are coming under pressure, sinking to four-month lows, amid fresh deterioration in the prospects for the property sector and concerns that indebted local governments in China may scale back infrastructure spending.

In equity news, Worldline shares were down sharply as it warned of slower growth this year after posting a loss for 2023.

Shares in Vodafone were up as the telecoms giant confirmed advanced talks with Swisscom over the sale of its Italian business for €8bn in cash.

Denmark's Sydbank surged after the bank posted record annual profits.

UK housebuilder Taylor Wimpey was lower as it planned to build fewer homes this year and revealed a slump in profits.

Reporting by Frank Prenesti for Sharecast.com