Europe Markets: Losses for banks, chip maker send European stocks to lower close


An earlier version of this report incorrectly identified where chip maker AMS AG has its headquarters.


Euphoria after upbeat German data — but it is short-lived.

European stocks lost ground Tuesday as big decliners such as Italian banks and Austrian chip maker AMS AG offset an encouraging reading on German business sentiment.

The Stoxx Europe 600

SXXP, -0.31%

 fell 0.4% to close at 343.07, as earlier gains didn’t stick. The pan-European gauge had traded as high as 345.65 on Tuesday, after Germany’s Ifo institute said the business mood in Europe’s largest economy rose to a 2.5-year peak.

Big decliners: AMS

AMS, +0.19%

 plunged 13% on the Swiss exchange in the wake of its third-quarter report. AMS said it sees “muted” growth for its business in the fourth quarter due to “a negative development at a specific customer.”

Italian banks also were among the big losers, as Banca Monte dei Paschi di Siena SpA said it would cut 2,600 jobs, shutter 500 branches and shed businesses as part of a make-or-break effort to persuade skeptical investors to buy into a big capital increase.

Outside the Stoxx 600, BMPS

BMPS, -14.71%

 fell 15%. Within the index, Unione di Banche Italiane SpA

UBI, +0.87%

 shed 3.7%, and Banca Popolare dell’Emilia Romagna

BPE, +1.10%

 lost 4.2%.

Other movers: On the upside, Luxottica Group SpA’s stock

LUX, -0.45%

 closed up 4.4% after the Italian eyewear giant said third-quarter sales grew 3.2%.

Two Finnish paper makers were the Stoxx 600’s biggest winners. UPM-Kymmene Oyj

UPM1V, +0.90%

 and Stora Enso Oyj

STERV, +1.86%

 gained 11% and 6.9%, respectively, after producing stronger-than-anticipated quarterly earnings.

Meanwhile, mining stocks were among the notable advancers, moving up as prices for gold and most other metals rose. Gold futures

GCZ6, +0.20%

gained 0.8% to $1,273.80 an ounce.

Also helping the sector, Anglo American PLC

AAL, -2.15%

 posted higher third-quarter output across all divisions except copper. Anglo tacked on 4.6%, Antofagasta PLC

ANTO, -7.03%

 rose 3%, Rio Tinto PLC

RIO, -0.80%

RIO, +3.02%

RIO, +1.70%

 gained 4.5%.

Read: Why mining stocks are due for a 20% drop

Shares of wind turbine manufacturer Gamesa Corporacion Tecnologica SA

GAM, -0.19%

 added 0.3% after the International Energy Agency significantly lifted its forecast for five-year growth in renewable energy.

German mood: The Ifo institute’s business climate index increased to 110.5 points in October from 109.5 in September, reaching its highest level since April 2014.

“The German Ifo data has provided further evidence that the economic engine of the eurozone is picking up steam,” said Naeem Aslam, chief market analyst at ThinkMarkets, in a note.

Indexes: Germany’s DAX 30

DAX, -0.45%

closed down less than 0.1% at 10,757.31, while France’s CAC 40

PX1, -0.40%

edged down 0.3% to 4,540.84.

Bucking the negative trend, the U.K’s FTSE 100

UKX, -0.55%

 tacked on 0.5% to 7,017.64, helped by the miners’ gains.

The euro

EURUSD, +0.2020%

 was changing hands at $1.0887, up from $1.0875 late Monday in New York.

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