European shares fell for a sixth straight session on Wednesday as a slew of mixed earnings reports heightened worries about the impact of tighter monetary policies and soaring inflation on corporate profits.
The pan-European STOXX 600 index (.STOXX) was down 0.1%, hovering near its lowest level in over a week, with rate-sensitive bank (.SX7P), real estate (.SX86P) and insurance (.SXIP) sectors leading the losses. Weak results from Barratt Developments (BDEV.L), Britain's largest housebuilder, sparked a selloff in the sector.
Dutch health technology company Philips (PHG.AS) fell 7.0% to 10-year lows after it said its quarterly core profit would drop around 60%, and flagged a massive charge on the value of its plagued sleep and respiratory care business.
"Although depressed sentiment and cheapened valuations are tailwinds for European stocks, the region's macroeconomic outlook remains a potent headwind that could lead to further downside for European earnings," analysts at BCA Research wrote in a note. The index has shed over 20% so far this year but still fares better than New York's S&P 500 (.SPX) that lost nearly 25%.
The International Monetary Fund cut its 2023 global growth forecast on Tuesday, saying countries representing a third of world output could be in recession next year.
Credit Suisse (CSGN.S) dropped 3.1% after Bloomberg reported the U.S. Justice Department is investigating whether the Swiss lender continued helping U.S. clients hide assets from authorities, eight years after it paid a $2.6-billion tax evasion settlement.
Among gainers, LVMH (LVMH.PA) rose 2.7% after the French luxury goods giant beat market forecasts for third-quarter sales as wealthy shoppers splurged on fashion and Americans in Europe made the most of the strong dollar.
