Global Stocks Mixed as Earnings Hit European Shares

By Josie Cox 

        Global stocks were mixed Tuesday as downbeat earnings hit shares in Europe and fresh measures to curb volatility prompted a rally in China.
        In Europe, the Stoxx Europe 600 was trading 0.3% lower midafternoon.
        Shares in Abengoa SA were down close to 20%, deepening sharp losses incurred Monday which were triggered by the energy company announcing a EUR650 million capital increase and a EUR500 million divestment plan, following poor second-quarter results on Friday.
        Shares in Credit Agricole SA fell more than 11%. The lender posted a sharp jump in second-quarter net profit but also said plans to revise its complex structure have hit a hurdle as it has yet to agree terms with European regulators.
        Analysts at Credit Suisse wrote in a note that this lack of clarity around the group's future corporate governance structure would likely exert pressure on the share price going forward.
        Standard Life PLC shares also fell after the British insurer and asset manager reported total revenue fell to GBP5.67 billion in the first half of this year from GBP6.16 billion in the same period last year.
        Oil companies continued to lag. On Tuesday in Europe, the price of Brent was 1.2% higher at $50.10. The world's benchmark oil price fell to less than $50 a barrel on Monday for the first time in six months.
        The European subindex of oil and gas was 0.4% lower.
        Lee Hardman, a strategist at Mitsubishi UFJ Financial Group, said that the recent oil slide had prompted him to cut his outlook for the Canadian dollar, the Norwegian krone and the Russian ruble, he said.
        All three currencies traded higher against the U.S. dollar on Tuesday but have fallen by more than 7% against the buck over the last three months. Over that same period, Brent crude is down close to 12%.
        In the U.S, the S&P 500 opened marginally higher on Tuesday.
        The Shanghai Composite Index closed 3.7% higher after Chinese authorities late Monday moved to clamp down on short selling by implementing rules under which investors must wait at least one day to cover their positions and pay back loans used to buy shares.
        When shorting a stock, investors sell borrowed shares in the belief they can buy them back at a much lower price later on, pocketing the difference.
        Investors also kept a sharp eye on the main stock index in Athens on Tuesday, which fell 4.5% in early trade and was down 2.2% around midday.
        The benchmark Athex Composite opened for the first time on Monday in just over five weeks and closed 16% lower, representing its biggest fall in percentage terms since at least January 1991, according to Thomson Reuters data.
        Shares in Piraeus Bank SA, Eurobank Ergasias SA, Alpha Bank AE and National Bank of Greece SA were all down by more than 25% on Tuesday, mirroring Monday's losses. Athex trading restrictions prevent stocks from falling by more than 30%.
        In currency markets, the euro was slightly higher against the dollar at $1.096. The dollar was also little changed against Japan's yen at Yen123.90.
        Gold was 0.2% higher at $1,091.10 per troy ounce.
        Write to Josie Cox at josie.cox@wsj.com
        (END) Dow Jones Newswires

        August 04, 2015 09:40 ET (13:40 GMT)

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