European stocks retreat as investors watch corporate earnings, Covid cases

  • Earnings season continued to gather steam Monday, with Michelin, Faurecia, Ryanair and Philips all reporting.
  • Germany's Ifo Institute publishes its business climate and expectations surveys for July on Monday morning.

European stocks pulled back Monday, tracking lackluster global sentiment as investors monitored corporate earnings and looked ahead to a key meeting of the U.S. Federal Reserve.

The pan-European Stoxx 600 fell 0.4% in early trade, with autos shedding 1.4% to lead losses while basic resources was the sole sector in positive territory, gaining 0.8%.

Shares in Asia-Pacific were mixed on Monday, with Hong Kong's Hang Seng index falling sharply along with mainland Chinese markets. Regulatory pressure and an acrimonious start to a summit between China and the U.S. pushed down tech and education stocks in the region.

Stateside, U.S. stock futures fell in early premarket trade on Monday ahead of a huge week of big tech earnings. Investors are also looking ahead to the Federal Open Market Committee meeting later this week for hints as to when the central bank may begin tapering its stimulus program.

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Back in Europe, earnings season continued to gather steam Monday, with Michelin, Faurecia, Ryanair and Philips all reporting.

Ryanair reported a 273 million euro ($322 million) loss for the second quarter and cautioned that it may finish the fiscal year "somewhere between a small loss and breakeven" as Covid-19 restrictions linger.

In corporate news, Credit Suisse has agreed an out-of-court settlement with former wealth management boss Iqbal Khan over the spying scandal that led to the resignation of former CEO Tidjane Thiam.

Investors continue to monitor a surge in Covid-19 cases across the continent driven by the highly-transmissible delta variant, which has led several countries to reimpose social restrictions.

On the data front, Germany's Ifo Institute publishes its business climate and expectations surveys for July on Monday morning.

In terms of individual share price movement, tech investment company Prosus slid 6.7% on the back of China's new measures against social media and gaming titan Tencent.

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