European stocks may fall for a fourth week as stalling economic growth drives more companies to cut profit forecasts, some investors said.
"What is preying on people's minds is that we will get another raft of disappointing economic data," said David Ballance, who oversees US$800 million as head of European equities at Rothschild Asset Management.
"It's quite possible that stocks will go back to the levels we saw in July," when the Dow Jones Stoxx 50 Index dropped to a five-year low, Ballance said. He recently sold Siemens AG shares.
The Stoxx 50 lost 3 percent this week as Royal Philips Electronics NV, Europe's third-largest maker of semiconductors, lowered its forecast for chip sales this quarter and Corus Group Plc, the region's No. 2 steelmaker, said it sees no signs of an economic recovery. The benchmark ended the week 5 percent above the low set July 24.
The Bank of France reduced its third-quarter growth forecast for the country's economy, Europe's third-largest, this week. In the US, a report yesterday showed consumer confidence fell to the lowest level since November. The latter damped the outlook for European companies such as LVMH Moet Hennessy Louis Vuitton SA, which sells items such as perfume and champagne in America.
Evidence of attitudes among consumers in the EU will be available Thursday, when Italian confidence figures are released. The week's economic reports also include statistics on French industrial production and US manufacturing and statistics due on Tuesday.
"I'm not too optimistic" that reports such as these will signal an economic rebound, said Hans Slomp, who manages about US$2 billion at SNS Asset Management. He's been selling industrial stocks and increasing his holdings of drug shares whose earnings are less reliant on economic expansion.
Alcatel SA, Europe's No. 1 phone-equipment maker, slumped 8.3 percent after rival Lucent Technologies Inc. forecast its sixth-straight quarterly sales decline.
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