EUROPE MARKETS: European Stocks Pull Back After Biggest Rally In 2 Months

By Sara Sjolin, MarketWatch Features Dow Jones Newswires

Trading volumes in Europe reduced by Fourth of July holiday in the U.S.

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European stocks edged lower Tuesday, with the region's benchmark pulling back from its biggest rally in two months, as North Korea's latest missile launch dented appetite for risk.

The Stoxx Europe 600 indexfell 0.3% to end at 382.30, the fifth loss in six sessions for that pan-European benchmark. The index on Monday had rallied 1.1% (http://www.marketwatch.com/story/european-stocks-rebound-from-2-month-low-as-banks-oil-giants-climb-2017-07-03) for its biggest one-day percentage gain since April 24, buoyed by rises for banks and oil giants.

Trading volumes on Tuesday were lighter than usual as trading in the U.S. paused for the Independence Day holiday.

Read:July 4th: Which markets are closed? (http://www.marketwatch.com/story/july-4th-which-markets-are-closed-2017-06-30)

North Korea tensions: The pullback on Tuesday came as investors assessed the latest developments in North Korea. State media claimed the country had successfully test-launched an intercontinental ballistic missile (http://www.marketwatch.com/story/north-korea-claims-successful-test-firing-of-an-icbm-2017-07-04), an advance in its attempt to threaten the U.S. and regional rivals with a nuclear weapon.

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Traditional safe-haven trades, such as gold and the yen, benefited from the geopolitical uncertainty. Goldrose 0.3% to $1,222.90 an ounce, while the dollarbought Yen113.17, compared with Yen113.38 late Monday in New York.

Noting that a G-20 meeting convenes this week in Hamburg, Germany, Elsa Lignos, global head of foreign-exchange strategy, wrote: "North Korea has previously fired missiles around international summits ... and U.S. Independence Day. But it comes at an awkward time. China-U.S. relations have heated up in the past week, with China 'outraged' by last Friday's U.S. arms deal with Taiwan. Still pending is a White House decision on whether to restrict steel/aluminium imports, which could raise tensions further."

Worldpay surges: Shares of payments processor Worldpay Group PLC(WPG.LN)surged as much as 32% (http://www.marketwatch.com/story/british-payments-processor-soars-nearly-30-on-news-of-possible-american-takeover-2017-07-04) after the company confirmed it has been approached by Vantiv Inc.(VNTV)and J.P. Morgan Chase & Co.(JPM)about possible takeovers (http://www.marketwatch.com/story/worldpay-shares-soar-after-takeover-approaches-2017-07-04). "There can be no certainty either that an offer will be made," Worldpay said.

The confirmation comes a day after Danish digital-payments company Nets AS(NETS.KO)said it had been approached by potential buyers. Nets rose 2.7% on Tuesday.

German payments-processing company Wirecard AG(WDI.XE)also jumped Tuesday, up 7.1%, while French payments-services provider Worldline SA(WLN.FR)moved up 3.5%.

Stock movers: Shares of J Sainsbury PLC(SBRY.LN)(SBRY.LN)pared earlier gains but closed up 0.3% after the supermarket chain said that first-quarter same-store sales rose 2.3% (http://www.marketwatch.com/story/sainsbury-sales-rise-cost-savings-on-track-2017-07-04) and that its cost-paring plan is on track.

Stada Arzneimittel AG shares(SAZ.XE)rose 2.2% after the German drug maker said Bain Capital and Cinven were considering asking for regulatory permission to launch a new takeover offer (http://www.marketwatch.com/story/stada-bain-cinven-seeking-regulator-ok-for-fresh-takeover-bid-2017-07-04). An earlier offer valuing Stada at 5.3 billion euros failed in June (http://www.marketwatch.com/story/stada-takeover-by-baincinven-fails-2017-06-27), as shareholders didn't tender enough shares to reach the minimum acceptance required.

SKF AB(SKF-B.SK)lost 1.7% after the ball-bearings manufacturer said it is being sued by German car maker Daimler AG(DAI.XE)as a consequence of a 2014 European Union settlement decision over violation of competition rules.

Ryanair Holdings PLC(RYAAY)advanced 1.4%. The discount airline said passenger traffic had increased to 11.8 million customers in June, up 12% from the year-earlier month.

Individual indexes: The FTSE 100 indexshed 0.3% (http://www.marketwatch.com/story/ftse-100-falls-back-into-the-red-as-oil-majors-and-miners-decline-2017-07-04) to 7,357.23, under pressure from falls for the U.K. benchmark's oil companies and banks.

Germany's DAX 30 indexslipped 0.3% to 12,437.13, while France's CAC 40lost 0.4% to 5,174.90.

The eurowas last at $1.1346, compared with $1.1365 late Monday in New York.

Economic news: Producer prices in the eurozone fell more than expected in May (http://www.marketwatch.com/story/eurozone-may-producer-prices-fall-more-than-seen-2017-07-04), down 0.4% on a month-on-month basis. Economists had expected a decline of 0.2%.

Growth in the U.K. construction sector slowed in June, with the construction purchasing managers index falling to 54.8 from 56 in May.

In Sweden, the Riksbank said it's now "less likely" than previously to cut rates as inflation has been higher than expected. That means that the central bank -- long seen as extremely dovish -- has joined the European Central Bank and Bank of England in signaling an end to ultraloose monetary policy.

(END) Dow Jones Newswires

July 04, 2017 13:12 ET (17:12 GMT)