European stocks dropped for a third straight week, the longest stretch of losses since March, as concern mounted that the economy won’t recover soon.
Volkswagen AG slumped 6.3 percent, leading declines in automakers, after U.S. car sales fell in June and Credit Suisse Group AG cut its assessment of the industry. ThyssenKrupp AG, Germany’s largest steelmaker, and Finland’s Outokumpu Oyj dropped more than 3 percent as an industry group said European steel consumption will fall in 2009.
The Dow Jones Stoxx 600 Index fell 0.2 percent this week to 204.08 after reports showed unemployment in Europe and the U.S. rose. The measure has fallen 4.8 percent since June 12 on speculation share prices have outpaced the outlook for economic growth after a three-month rally pushed valuations to 25.4 times earnings, near the highest level since 2004. The benchmark index for European equities still rose 17 percent in the second quarter, the biggest gain since 1999.
“Macroeconomic data are still disappointing and show economic recovery is not yet a reality,” said Emmanuel Soupre, who helps manage about $18 billion at Neuflize OBC in Paris. “We are going to keep fluctuating between optimism and pessimism in the months to come.”
Unemployment in the 16-member euro region increased to 9.5 percent in May from a revised 9.3 percent in April, the European Union statistics office in Luxembourg said this week. The U.S. unemployment rate rose to 9.5 percent in June, the highest since August 1983.
Source/Full Story: Bloomberg.com
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Source/Full Story: Bloomberg.com
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