European stocks fell to their lowest in more than three months this week as companies including ArcelorMittal and Vinci SA posted worse-than-expected earnings.
ArcelorMittal dropped the most since October 2012 after also lowering its full-year profit forecast, as Vinci slipped the most in almost three years and Iliad SA retreated 7 percent after offering US$15 billion for a controlling stake in T-Mobile US Inc.
Belgacom SA gained 4.8 percent after raising its full-year earnings outlook.
The STOXX Europe 600 Index fell 1.2 percent to 331.91 at the close of trading on Friday. It pared an earlier drop of as much as 1.5 percent as worse-than-forecast US payrolls data increased optimism that the US Federal Reserve will keep interest rates low for longer.
The benchmark gauge trades at 15 times estimated earnings, near last month’s four-and-a-half-year high of 15.7, data compiled by Bloomberg show.
“In Europe, we’re seeing a weak economy with very bad currency effects on companies and unattractive valuations,” said Jacques Porta from Ofi Gestion Privee. “That doesn’t give investors a good feeling about buying the market. We’ve seen weak results in Europe, so sentiment is turning bearish.”
A Markit Economics purchasing managers’ index of eurozone manufacturing was unchanged last month at 51.8. Economists had called for 51.9. A reading above 50 means activity increased.
A purchasing managers’ index for the UK fell to the lowest level in a year, while a measure of manufacturing in Italy missed estimates, posting growth at the slowest pace in eight months.
National benchmark indices fell in 16 of the 17 Western European markets open on Friday. Markets in Switzerland are closed for the National Day holiday.
The UK’s FTSE 100 Index lost 0.8 percent, France’s CAC 40 slid 1 percent and Germany’s DAX tumbled 2.1 percent, with all three erasing their gains for the year.
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