Major European Markets Close Slightly Lower After Volatile Session

(RTTNews) - European stocks, which had their best month of the year in July, began the new month on a somewhat volatile note and ended slightly lower on Monday with investors digesting the latest batch of earnings updates and weighing growth prospects amid rising interest rates and policy tightening by central banks.

Stocks spent much of the day's session till mid afternoon on the positive side, but swung between gains and losses after that to eventually finish on a slightly negative note.

Data showing a contraction in China's factory activity in the month of July raised concerns about economic slowdown.

The pan European Stoxx 600 drifted down 0.19%. The U.K.'s FTSE 100 ended 0.13% down, France's CAC 40 ended lower by 0.18% and Germany's DAX edged down 0.03%. Switzerland's SMI advanced 0.15%.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Norway, Portugal, Russia, Spain and Sweden ended with sharp to moderate losses.

Netherlands edged down marginally. Finland, Greece, Iceland, Ireland, Poland and Turkey closed higher.

In the UK market, shares of publishing and education firm Pearson soared nearly 13% after the company reaffirmed its full-year guidance after posting a 22% rise in first-half adjusted operating profit.

HSBC Holdings gained 6.1% after reporting second-quarter earnings that beat analysts' forecasts.

Ocado Group surged 4.3%. Avast, Auto Trader Group, Rightmove, BAE Systems, Haleon, Compass Group, Barclays and Scottish Mortgage gained 1.5 to 3.2%. Natwest Group, Hikma Pharmaceuticals, Berkeley Holdings, Persimmon and B&M European Value Retail also ended notably higher.

Melrose Industries tumbled 5.5%. Anglo American Plc, Intertek Group, Prudential, IAG, Shell, GSK, BP, Smiths Group, Antofagasta, DCC, Segro and Ashead Group shed 1 to 4%.

AstraZeneca ended 1.25% down. Innate Pharma SA announced that a planned futility interim analysis of the INTERLINK-1 Phase 3 study sponsored by AstraZeneca did not meet a pre-defined threshold for efficacy.

In Paris, Air France-KLM climbed nearly 6%. Renault gained about 4.2%. Engie, Essilor, Thales, LVMH, Faurecia, Hermes International, Pernod Ricard and STMicroElectronics gained 1 to 3.2%.

Sanofi, Carrefour, Atos, Airbus Group, Vinci and Publicis Groupe ended lower by 1.25 to 3%.

In the German market, HelloFresh rallied more than 3.5%. Puma gained 2.6% and Adidas moved up by about 2%. Deutsche Boerse, Volkwagen, SAP, Deutsche Post and Deutsche Telekom also ended with solid gains.

Vonovia, HeidelbergCement, Fresenius Medical Care, Siemens, Deutsche Bank and Continental lost 1 to 2.5%.

Data released by Destatis showed Germany's retail sales declined in June at the fastest pace since the records began in 1994, logging an annual decline of 8.8%. Sales were expected to fall 8% after rising 1.1% in May. On a monthly basis, retail turnover dropped 1.6% in June, confounding expectations for an increase of 0.2% and reversed May's 1.2% increase.

Data from Eurostat showed the jobless rate in the euro area came in at seasonally adjusted 6.6% in June, the same rate as seen in May and in line with expectations. The youth jobless rate was 13.6%, down from 13.2% in May.

The EU unemployment rate was 6% in June, also stable compared with May. At the same time, the youth unemployment rate rose to 13.6% from 13.3%.

The euro area manufacturing sector contracted in July as production logged the sharpest fall since the initial wave of the COVID-19 lockdowns in early 2020, final data from S&P Global showed.

The final manufacturing Purchasing Managers' Index fell to a 25-month low of 49.8 in July from 52.1 in June. The flash reading was 49.6.

The UK manufacturing sector growth moderated to a 25-month low in July as the downturn in production and new work continued amid heightened uncertainty, the cost of living crisis and supply chain issues.

The Chartered Institute of Procurement & Supply final manufacturing Purchasing Managers' Index declined to a 25-month low of 52.1 in July from 52.8 in June, the survey results published by S&P Global showed. The flash reading was 52.2.

Nonetheless, the PMI held above the 50.0 no-change mark due to faster jobs growth, rising stocks of purchases and longer vendor lead times.