European shares fell on Thursday, weighed down by losses among pharma and mining sector stocks, while firms such as Sunrise and Ahold were lifted by well received earning updates.
The pan-European STOXX 600 index fell 1.1 per cent by 0828 GMT, weakened by a disappointing sentiment survey in Germany and pulling back from a one-week high hit on Wednesday.
The Ifo economic institute said German business morale deteriorated in August, suggesting company executives in Europe’s largest economy have become less optimistic since Britain’s vote to leave the European Union.
“In order for stocks to set up the next leg higher, better than expected economic data out of the euro zone will be needed,” said Markus Huber, trader at City of London Markets.
The STOXX 600 Healthcare index fell 2.2 per cent, making it the weakest sector on the day, led lower by shares such as Qiagen, BB Biotech and Shire, all down over 3 per cent.
Sector stocks mirrored losses in their US peers which were hit by presidential candidate Hillary Clinton’ s call on Mylan to drop the price of an allergy treatment drug which has increased in price by more than 400 per cent in the past decade.
The STOXX 600 Basic Resources index also fell more than 2 per cent led by a 3.7 per cent drop in mining giant Glencore following disappointing set of results in the previous session.
But Sunrise Communications rose 4.4 per cent after the Swiss telecoms company posted a fall in core earnings that was narrower than expected and confirmed its guidance.
“The strong second quarter showing by Sunrise in a maturing and competitive market is evidence that its investments in network, distribution and customer service are paying off," analysts at Berenberg said.
Ahold also rose, by 1.4 percent, following strong results. The operator of supermarket chains in the United States and Europe reported better-than-expected second-quarter earnings growth and said it expects free cash flow of 1.3 billion euros for the full year.
Among outstanding gainers, GFK soared as much 9 per cent after German weekly WirtschaftsWoche reported that its majority owner is looking at options including a merger or sale. The stock later pared some gains and was up 3.9 per cent.