By Tommy Stubbington
European stocks fell Tuesday, reversing most of the previous
day's gains as losses for pharmaceutical stocks weighed on
markets.
The Stoxx Europe 600 was 0.8% lower midmorning. The index had
surged by 1% on Monday after a shake-up of Greece's team
negotiating with creditors was seen by investors as increasing the
chance of a deal on further financial aid for Athens.
In bond markets, the relief continued on Tuesday, with Greek
two-year bond yields falling more than a percentage point to 20.9%.
Yields fall as prices rise.
"The Greek government looks to be laying the ground for at least
some form of political compromise," said analysts at Rabobank.
But in equity markets the rally faded as Monday's steep decline
in highflying U.S. biotechnology stocks weighed on the sector in
Europe. Health care companies on the Stoxx 600 sank 1.6%.
Elsewhere, investors looked to earnings.
Energy shares shrugged off a fall in the oil price to climb 0.5%
following a smaller than expected decline in first quarter profit
for sector giant BP.
Daimler AG was among the top risers after posting strong first
quarter earnings.
Swiss engineering firm Geberit AG slipped after it said the
surging Swiss franc hurt its first quarter profit.
Germany's DAX index was 0.6% lower, France's CAC 40 lost 0.9%,
while the U.K.'s FTSE 100 was down 0.8%.
In the U.S., futures indicated a 0.2% opening loss for the
S&P 500. Changes in futures aren't necessarily reflected in
moves after the opening bell.
In currency markets, the British pound fell 0.2% against the
dollar to $1.5190 after the U.K. economy grew more slowly than
expected in the first quarter. Slower growth is likely to encourage
the Bank of England to hold off for longer before raising interest
rates.
The euro was 0.1% higher against the buck at $1.0885.
In commodities, Brent crude was 0.6% lower at $64.43 a barrel.
Gold fell 0.2% to $1,200.40 an ounce.
Write to Tommy Stubbington at tommy.stubbington@wsj.com
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