In Europe on Wednesday, stocks scored consecutive daily gains for the first time in three weeks, drawing support from a weak euro. The FTSEuroFirst index of the leading 300 European shares <.FTEU3> closed up 0.3 percent, having earlier fallen as much as 0.4 percent, and Germany's DAX <.GDAXI> staged a similar rebound to trade up 0.5 percent before paring some gains. (Traders work at their desks in front of the German share price index, DAX board, at the stock exchange in Frankfurt, Germany, August 23, 2016. REUTERS)
LONDON: Slumping technology stocks after a global cyber attack and depressed crude oil prices cast a cloud over European shares on Wednesday, sending them to their lowest in two months.
The pan-European STOXX 600 hit its lowest since April 24 in early deals, down 1 percent, in step with euro zone stocks and blue-chips.
Technology stocks fell 1.6% to a two-week low, the worst performer with every stock on the index in the red.
The losses came after a ransomware attack swept the globe, disrupting computers at banks and large companies including WPP , Moeller Maersk and Metro.
Shares in affected companies were not hugely or uniformly dented, with WPP down 0.4%, Maersk up 0.2% and Metro up 0.5%.
Anti-virus provider Sophos fell 4.9%, a top UK mid-cap faller, and security firm NCC Group slid 2.1%. Both had been among the best performers when a global ’WannaCry’ ransomware attack hit computers in mid-May.
In Helsinki, digital security firm F-Secure, which had also made gains in the previous cyber-attack, was down 1%. But investors said tech stocks were falling in the wake of U.S. peers.
“Tech generally is weak following the lead of U.S. tech which sold off aggressively last night,” said Neil Campling, head of global telecoms, media and technology research at Northern Trust, adding that a downgrade to ‘hold’ was also weighing on Sophos.
“After high profile attacks you have a massive spike in corporate activity - shutting the door after the horse has bolted,” he added. ”We see the downgrade today on Sophos as giving an opportunity to buy.”
Semiconductor makers AMS, Dialog Semiconductor , ASM International and STMicro were among the worst performers on Wednesday, falling 2 to 4.1%.
Interest-rate sensitive utilities and real estate stocks tumbled, weighed by hawkish comments from European Central Bank President Mario Draghi and a slew of Federal Reserve policymakers including Fed Chief Janet Yellen.
Germany’s utilities RWE and E.ON were the worst-performing on the DAX, down 2 to 2.2%.
Adding insult to injury, lower oil prices weighed on oil and gas stocks, with Tullow Oil the biggest faller after its first-half results.
Meanwhile, positive results and acquisitions drove the handful of gainers.
Business supplies distributor Bunzl bounced 4% after saying a boost in recent acquisitions would help it increase first-half revenue 7%.
“We anticipated an acceleration in underlying growth to 7% in the second half but organic growth is tracking ahead of our forecasts already at Q2,” said UBS analysts.
“New M&A announced today should have a positive impact of around 0.5% to the top-line when fully annualised,” they added.
French industrial group Legrand also rose 2.8% after saying it would buy U.S. infrastructure company Milestone. - Reuters
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