European markets fell Tuesday morning as investors took profit following a near-two week rally in the wake of the Bank of England’s decision to cut interest rates. Mostly positive news flow, including better-than-expected quarterly earnings from BHP Billiton (LON:BLT), limited the downside.
The FTSE 100 was narrowly in the red, with telecoms the worst performing sector led by shares of Vodafone (LON:VOD) after the proposed merger between its New Zealand unit and Sky Network ran into opposition.
Basic Resource shares were top performers after BHP Billiton’s record quarterly loss exceeded beaten-down expectations and copper-miner Antofagasta (LON:ANTO) beat EBITDA and net profit forecasts in its half-year update.
BHP Billiton posted an annual loss of $6.4bn loss, worse than the $6.0bn expected and its biggest loss ever. Write-downs and impairments made up the bulk of the loss whilst underlying operating profit came in at $1.2bn, above expectations of $1.1bn. Dividends were cut to 14c but given the difficulties of the Samarco dam disaster and the fall in commodity prices, investors will be thankful to be getting anything.
US stocks look set for a pull back from another triple record high set on Monday ahead of the release of inflation and industrial production data.
USA pre-opening levels
S&P 500: 3 points lower at 2,187
Dow Jones: 20 points lower at 18,616
Nasdaq 100: 6 points lower at 4,821
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