EUROPE MARKETS: Germany's DAX Ends With Small Loss, Retreating From Record

By Carla Mozee and Victor Reklaitis, MarketWatch Features Dow Jones Newswires

Stoxx Europe 600 and FTSE 100 manage to end higher

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A pan-European stock benchmark closed slightly higher Monday, while German's main gauge pulled back from a record, as a drop for banks and telecoms limited gains and as a political shake-up in Saudi Arabia caused some jitters.

A slowdown in services activity weighed on shares in Spain, already battered by the ongoing political crisis over independence for Catalonia.

What markets are doing: The Stoxx Europe 600 rose 0.1% to 396.59, putting the index nearer to a 52-week closing high reached last Wednesday.

Germany's DAX 30 index dipped by 0.1% to end at 13,468.79. On Friday, it finished at a closing high of 13,478.86.

France's CAC 40 shed 0.2% to finish at 5,507.25, and Spain's IBEX 35 dropped 0.4% to 10,316.50.

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The U.K.'s FTSE 100 rose less than 0.1% to end at 7,562.28 for a fresh record close.

"Stock markets have been strong in Europe lately, and it appears the bulls are taking a breather today," said CMC Markets analyst David Madden in a note.

What's moving markets: Investors were assessing the news that Saudi Arabian officials and members of the royal family were detained at the weekend, including tycoon Prince al-Waleed bin Talal, as part of an anticorruption crackdown.

Read:Detained Saudi prince has wide range of investments in Western companies (http://www.marketwatch.com/story/detained-saudi-prince-has-wide-range-of-investments-in-western-companies-2017-11-05)

The arrests of such high-profile figures are seen as a dramatic escalation in the effort by Prince Mohammed bin Salman, the recently appointed crown prince, to consolidate power and accelerate far-reaching change (http://www.marketwatch.com/story/stunning-saudi-purge-solidifies-crown-princes-power-2017-11-05) in the kingdom.

Meanwhile, Turkey's central bank on Monday took steps to support price and financial stability (http://www.marketwatch.com/story/turkeys-central-bank-acts-to-support-falling-lira-2017-11-06), after the Turkish lira's recent slump against the dollar. The tweak to its reserve option mechanism will withdraw about 5.3 billion lira ($1.37 billion) of liquidity from the market and provide banks with approximately $1.4 billion of liquidity, the Central Bank of the Republic of Turkey said.

The euro traded at $1.1602, down from $1.1610 late Friday in New York.

Banks weigh: The Stoxx Europe 600 Bank Index lost 0.4%. Société Générale SA (GLE.FR) shares dropped 3.7%, extending Friday's slide of 4% after a disappointing earnings report.

The U.S. Justice Department and Federal Bureau of Investigation are investigating three European banks for their roles (http://www.marketwatch.com/story/us-probes-credit-suisse-bnp-paribas-vtb-over-mozambique-debt-sales-2017-11-06) in selling about $2 billion of debt for Mozambique, according to a report from The Wall Street Journal.

Stock movers: Altice NV (ATC.AE) fell 3.2% after its Altice USA Inc. (ATUS) cable and internet subsidiary and Sprint Corp. (S) said over the weekend they've entered into a multiyear wireless partnership (http://www.marketwatch.com/story/sprint-inks-wireless-partnership-with-altice-after-t-mobile-merger-talks-end-shares-fall-nearly-12-2017-11-06) that will help Altice provide phone and data services to its customers. Sprint's potential merger talks with T-Mobile US Inc. (TMUS) ended without a deal. Shares of T-Mobile's parent Deutsche Telekom AG (DTEGY) fell 2.6%.

SBM Offshore NV shares tumbled 14% after the Netherlands-based oil-services company said it has made a provision of $238 million (http://www.marketwatch.com/story/sbm-makes-238-mln-provision-against-us-problems-2017-11-06) against issues in the U.S. related to potential improper sales practices.

Shares of Accor SA (AC.FR) finished roughly flat after erasing earlier losses. Saudi Prince Al-waleed bin Talal's Kingdom Holding Co. owns a 5.7% stake in the hotel properties company, according to FactSet data.

BTG PLC (BTG.LN) dropped 5.2% after the health-care company said it would make a provision of 53.5 million pounds (http://www.marketwatch.com/story/btg-makes-70-million-provision-after-us-ruling-2017-11-06) ($70 million) to cover damages and other costs related to a U.S. court ruling.

Vopak NV fell 6.1% as the provider of tank storage services reported a 25% fall in third-quarter net profit, (http://www.marketwatch.com/story/vopak-profit-falls-25-on-lower-occupancy-rate-2017-11-06) citing lower occupancy rates.

Economic docket: Spain's service sector activity was the slowest since January on reports that political uncertainty in the Catalonia region dampened growth, IHS Markit said Monday. The seasonally adjusted reading of 54.6 in October was down from 56.7 in September and below the FactSet estimate of 55.4.

In Germany, new orders in manufacturing increased by 1.0% on the month (http://www.marketwatch.com/story/german-manufacturing-orders-rise-beat-forecasts-2017-11-06) in September, beating expectations of a 1.3% decline. The unexpectedly strong reading points to a resilient growth pace in the German economy, analysts said.

Risk repricing: The Stoxx 600's muted move Monday came after last week's rise of 0.7%. The index had risen in eight of the past nine weeks, and on Wednesday last week it hit its highest level in more than two years (http://www.marketwatch.com/story/european-stocks-leap-to-2-year-high-as-commodity-shares-march-up-2017-11-01).

"Risk repriced very sharply in the last two months," with the CAC 40 and the DAX 30 among indexes that have charged higher, said Mislav Matejka, chief European equity strategist at J.P. Morgan Cazenove, in a note published Monday. "Where we think that it is prudent to lock in some profits is in cyclicals, which we move from overweight to neutral," he added.

The eurozone region "is in a good spot currently, we believe, as it benefits from any rise in bond yields, and from the euro peaking out," Matejka said, adding that robust economic data is among the factors that should support higher bond yields.

"Any rise in bond yields should be bullish for banks, as the two remain closely linked, as well as for cyclicals, at the expense of defensives. Also, higher yields are, in our view, ultimately bullish for the overall equity market, as they might help drive a shift in asset flows," he said.

Sicily vote: A center-right coalition headlined by former Italian Prime Minister Silvio Berlusconi appeared to have edged out the antiestablishment 5 Star Movement in Sunday's regional elections in Sicily (http://www.marketwatch.com/story/berlusconi-coalition-takes-lead-in-sicily-vote-exit-polls-show-2017-11-06), according to exit polls, but the solid showing by both groups suggest they could perform well in national elections next year.

(END) Dow Jones Newswires

November 06, 2017 12:27 ET (17:27 GMT)