EUROPE MARKETS: European Stocks Face 5th Straight Loss As Brexit Worries, Corporate Earnings Bite

By Carla Mozee, MarketWatch Features Dow Jones Newswires

U.K. stocks rise as pound gets slammed

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European stocks were dragged lower Monday, at risk for a fifth straight loss, after French utility Electricite de France SA issued a profit warning and on concerns about Brexit weighing on growth prospects for the eurozone.

What markets are doing: The Stoxx Europe 600 fell 0.3% to 387.45, led by losses for financial and industrial shares. But the health care and consumer goods sectors were up. On Friday, the regional benchmark fell 0.4% (http://www.marketwatch.com/story/european-stocks-veer-toward-worst-week-since-august-2017-11-10) and closed out last week by falling 1.8%, the biggest weekly percentage loss in three months.

France's CAC 40 gave up 0.3% at 5,366.37, and Germany's DAX 30 index slipped 0.2% to 13,102.70.

The U.K.'s FTSE 100 on Monday rose 0.2% (http://www.marketwatch.com/story/ftse-100-heads-for-a-win-as-political-turmoil-drags-down-the-pound-2017-11-13) to 7,448.77.

The euro traded at $1.1645, down from $1.1665 late Friday in New York. Against the pound, the shared currency fetched GBP0.8906, up from GBP0.8843 on Friday.

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Read:Is British leader Theresa May on her way out? Why that's the fear--and why it matters (http://www.marketwatch.com/story/is-british-leader-theresa-may-on-her-way-out-why-thats-the-fear-and-why-it-matters-2017-11-09)

What markets are doing: U.K. stocks diverged from their European counterparts, rising modestly as the pound dropped against the dollar, the euro and other currencies. A weak pound can boost earnings of multinational companies once they are converted from other currencies into sterling.

Pressure on the pound came after The Sunday Times reported (https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&uact=8&ved=0ahUKEwjJwKegh7vXAhVD2KQKHX25AqkQqUMILDAB&url=https%3A%2F%2Fwww.thetimes.co.uk%2Farticle%2Ftory-turmoil-as-40-mps-say-may-must-go-kkg3w6l89&usg=AOvVaw0P3ydYgZ0X_1ThNri40pNZ) that 40 lawmakers in the British parliament had agreed to sign a letter of no confidence in Prime Minister Theresa May. Just eight more MPs are required to start a formal leadership challenge, according to the report. Analysts have said May's troubles on the domestic front make it more difficult for her to fortify the U.K.'s hand in Brexit talks with the European Union.

But the eurozone economy would suffer along with the U.K.'s if there's a "disruptive" Brexit, an official at the International Monetary Fund told Reuters on Monday. (https://uk.reuters.com/article/uk-britain-eu-imf/imf-says-europes-growth-more-durable-warns-of-disruptive-brexit-threat-idUKKBN1DD0WZ)

What strategists are saying: "With the EU preparing for [Brexit] talks to collapse, the stakes are getting higher. Britain has less than two weeks to come up with answers for the EU or we face a potential no-deal scenario. If the market decides the U.K. cannot meet the EU's demands in time it could send the pound sharply lower, perhaps to $1.25 or below before the deadline is reached," said Neil Wilson, senior market analyst at ETX Capital, in a note.

Check out:Is British leader Theresa May on her way out? Why that's the fear--and why it matters (http://www.marketwatch.com/story/is-british-leader-theresa-may-on-her-way-out-why-thats-the-fear-and-why-it-matters-2017-11-09)

Opinion:Brexit hardliners are selling England by the pound (http://www.marketwatch.com/story/brexit-hardliners-are-selling-england-by-the-pound-2017-11-09)

Stock movers: EDF (EDF.FR) shares tumbled 10% after the company cut its 2018 EBITDA target (http://www.marketwatch.com/story/edf-shares-tumble-after-company-cuts-guidance-2017-11-13) to a range of EUR14.6 billion to EUR15.3 billion, compared with a previous forecast of at least EUR15.2 billion. EDF said it faces "unfavorable developments" in France and the U.K. The shares were facing their worst decline since December 2016.

Sonova Holding AG (SOON.EB) slid 6.3% after the hearing aid producer said first-half sales came in at 1.25 billion Swiss francs, which was below a Reuters consensus forecast of 1.29 billion francs.

Coca-Cola HBC shares fell 5.1%. The bottler's rating was cut to neutral from overweight at J.P. Morgan Cazenove, according to Dow Jones Newswires.

Aggreko PLC (AGK.LN) rose 2.3% after the power-equipment supplier named Heath Drewett as its chief financial officer (http://www.marketwatch.com/story/aggreko-appoints-heath-drewett-as-cfo-2017-11-13).

(END) Dow Jones Newswires

November 13, 2017 06:06 ET (11:06 GMT)