European shares snap five-day winning streak

By Joanne Frearson

LONDON (BestGrowthStock) – European shares fell on Monday, snapping five consecutive days of gains, led by drugmakers, with GlaxoSmithKline (GSK.L: ) hit by fresh criticism on its diabetes drug Avandia.

By 0925 GMT, the FTSEurofirst 300 (.FTEU3: ) index of leading European shares was down 0.3 percent at 1,023.27 points. The index which gained around 26 percent in 2009 is down 2.1 percent this year.

Drugmakers took the most points off the index. GlaxoSmithKline fell 1.2 percent after two U.S. drug safety reviewers have recommended that diabetes drug Avandia be pulled from the market.

Its peers AstraZeneca (AZN.L: ), Roche (ROG.VX: ) and Sanofi-Aventis (SASY.PA: ) were 0.4 to 0.9 percent lower.

“Asian shares have been firm and the U.S. was higher on Friday, giving support to Europe. But, Europe does not have any reason to run ahead given that it made good progress last week,” said Bernard McAlinden, market strategist at NCB Stockbrokers.

“There might be some near turn relief on Greece. The market has given it some benefit of the doubt that they will meet the requirements, but that is far from given and the markets can be quite fickle. I would not say Greece has gone away at all.”

A German weekly magazine said Germany’s finance ministry has sketched out a plan in which countries using the euro currency will provide aid worth between 20 billion and 25 billion euros ($27 billion to $33.7 billion) for Greece.

Across Europe, the FTSE 100 (.FTSE: ) index was up 0.1 percent, Germany’s DAX (.GDAXI: ) fell 0.2 percent and France’s CAC 40 (.FCHI: ) lost 0.2 percent.

COMMODS GAIN

Commodity stocks were in demand as crude and gold prices rose. Oil stocks BG Group (BG.L: ), BP (BP.L: ) and Royal Dutch Shell (RDSa.L: ) rose 0.4 to 0.5 percent.

Miners Antofagasta (ANTO.L: ), BHP Billiton (BLT.L: ), Rio Tinto (RIO.L: ) and Xstrata (XTA.L: ) were up 0.3 to 1.6 percent.

Banking stocks were mostly higher. HSBC (HSBA.L: ), BNP Paribas (BNPP.PA: ), Barclays (BARC.L: ) and Societe Generale (SOGN.PA: ) gained 0.2 to 1.3 percent.

However, Bank of Ireland (BKIR.I: ) fell 6.4 percent after the government took nearly 16 percent ownership of the lender — its first direct stake, in addition to Ireland’s 25 percent indirect stake.

In individual stock movers, Philips Electronics (PHG.AS: ) gained 1.3 percent after it said it has reached its target for “green” sales three years ahead of schedule and has set new targets for 2015.

Telecoms gear group Alcatel-Lucent (ALUA.PA: ) rose 5 percent after BofA Merrill Lynch put the firm on its list of recommended “buys”.

British distribution and outsourcing group Bunzl (BNZL.L: ) was 4.1 percent higher after it posted full year pretax profit ahead of forecasts.

Investment Research

(Editing by Mike Nesbit)

European shares snap five-day winning streak