European stocks experienced a downturn in cautious trading on Tuesday following analyst warnings that the euro area's economy, including its gross domestic product, could be affected if Donald Trump secures a win in the upcoming November presidential election.
Investor sentiment was further dampened by survey results indicating a significant drop in German investor morale for July. The ZEW Economic Sentiment index fell from 47.5 to 41.8 in July, underperforming expectations of 44.3, and marking its first decline in a year since July 2023.
The pan-European STOXX 600 index fell by 0.3 percent to 516.95, following a 1 percent drop on Monday. Germany’s DAX slid 0.4 percent, France’s CAC 40 decreased by 0.5 percent, and the U.K.’s FTSE 100 dipped by 0.1 percent.
French reinsurer SCOR saw its shares plunge by 26 percent after issuing a profit warning. The company now expects a loss of 0.4 billion euros for its L&H insurance service results in the second quarter, mainly due to reserve updates and continued negative experience variance.
In contrast, luxury goods conglomerate Richemont gained over 1 percent, reporting a slight rise in sales at constant exchange rates for the three months ending in June.
German fashion giant Hugo Boss saw its shares drop by 9 percent after downgrading its full-year outlook, citing a difficult second quarter and weakening consumer demand in key markets such as China and the U.K.
In London, mining stocks suffered as copper prices fell amid concerns over declining Chinese demand. Anglo American, Antofagasta, and Glencore all fell between 1-2 percent. Rio Tinto's shares fell by 2.5 percent after reporting second-quarter iron ore shipments that fell short of estimates.
Ocado's shares surged by 15 percent following an upward revision of profit forecasts for its primary technology division.
B&M European Value Retail climbed 3.4 percent as the discount retailer expressed optimism about achieving profitable, cash-generating growth for the entire fiscal year, posting a 2.4 percent revenue increase in Q1 FY2024.
Credit reporting firm Experian saw a 1.6 percent decline in its share price after announcing the departure of its chief operating officer.
