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European shares were little changed as a gauge of China manufacturing dropped more than forecast and minutes from the Federal Reserve’s last meeting signaled the U.S. may reduce stimulus in coming months.
The Stoxx Europe 600 Index retreated 0.1 percent to 322.64 at 4:34 p.m. in London. The gauge, which has rallied 15 percent this year, is poised for its first weekly drop in seven weeks.
National benchmark indexes retreated in eight of the 18 western European markets.
FTSE 100 6,681.33 +0.25 0.00% CAC 40 4,253.9 -14.47 -0.34% DAX 9,196.08 -5.99 -0.07%
The Fed expected economic data to signal improvement in the job market and “would thus warrant trimming the pace of purchases in coming months,” minutes of the U.S. central bank’s Oct. 29-30 meeting showed yesterday in Washington.
As of Nov. 19, four of five investors expected the Fed to delay a decision on the first cuts to bond buying until March 2014 or later, with 5 percent looking for a move next month, according to the latest Global Poll. Only one in 20 said the central bank will begin to reduce its purchases at its Dec. 17-18 meeting, according to the poll yesterday of investors, traders and analysts.
Equities pared earlier declines of as much as 0.7 percent as a report indicated fewer Americans than forecast filed claims for jobless benefits. Unemployment claims in the week ended Nov. 16 dropped by 21,000 to 323,000, the fewest since the period ended Sept. 28, from a revised 344,000 the previous week, the Labor Department said today in Washington.
A gauge of China’s manufacturing activity declined for the first time in four months. The preliminary 50.4 reading for the November Purchasing Managers’ Index released today by HSBC Holdings Plc and Markit Economics compared with a 50.8 median estimate from analysts surveyed. Levels above 50 indicate expansion.
In the euro-area, an index based on a survey of purchasing managers in the manufacturing industry rose to a 29-month high this month of 51.5 from 51.3 in October, London-based Markit Economics said today. An index of French manufacturing PMI unexpectedly declined to 47.8 from 49.1. Economists had predicted an increase to 49.5.
A separate report showed that an index of household confidence in the region fell to minus 15.4 from minus 14.5 in October, the European Commission said in a preliminary report. The median forecast of economists was for an increase to minus 14.
Atos dropped 4.2 percent to 61.60 euros for a fifth straight day of losses. Shareholder PAI Partners SAS is selling 8.9 million shares in the French company for 61.25 euros each.
Intermediate Capital lost 3.1 percent to 446.4 pence after it was cut to hold from add at Numis, which said that half-year results were weaker than expected. The London-based money manager reported first-half pretax profit rose to 155.3 million pounds ($250 million) from 39.6 million pounds in the same period a year earlier. The company’s assets under management shrank 6 percent to 12.1 billion euros.
Intermediate Capital and Nomura Holdings Inc. agreed to set up a mezzanine debt fund in Japan, citing increased demand as the world’s third-largest economy recovers.
Allianz fell 1.4 percent to 126.75 euros. Europe’s biggest insurer was cut to neutral from buy at Citigroup, which says earnings growth is limited.
British American Tobacco Plc (BATS) declined 2.2 percent to 3,285 pence, and Imperial Tobacco Group Plc (IMT) sank 2.6 percent to 2,368 pence. Philip Morris International Inc., the world’s largest publicly traded tobacco company, said yesterday international cigarette volume may drop as much as 3 percent next year.
Johnson Matthey rose 3.8 percent to 3,210 pence, the highest price since at least May 1989. The producer of a third of all auto catalysts used to cut vehicle pollution said first-half underlying pretax profit climbed to 202.1 million pounds from 180.1 million pounds a year ago. Revenue jumped to 6.41 billion pounds from 4.89 billion pounds last year.
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