European shares fell on Tuesday, dropping back from their highest levels since January, hit by weak U.S. data and a slump in France's Ingenico Group, which led Europe's tech sector lower
European shares fell on Tuesday, dropping back from their highest levels since January, hit by weak U.S. data and a slump in France’s Ingenico Group, which led Europe’s tech sector lower.
The pan-European STOXX 600 index fell 0.3 percent, after reaching its highest level since January in the previous session.
The market fell away in afternoon trade after the U.S. ISM services index dropped by the most since the financial crisis.
The dollar fell against the euro, hitting exporters, as the chances of a U.S. rate increase in September receded further.
The growth-sensitive banking sector fell the most, losing 1.7 percent. Banks have been under pressure, their profitability undermined by low interest rates.
The oil and gas sector dropped 0.9 percent, the next biggest decline, as Brent crude slipped below $47 a barrel. Oil prices dropped as hopes faded for imminent action to reduce a global supply glut.
“(The fall in oil) comes less than 24 hours after the black stuff has surged on news of an agreement between Russia and Saudi Arabia to stabilise the oil market,” said Connor Campbell, financials analyst at Spreadex.
“Investors (are) apparently less convinced than they were yesterday about the likelihood of this leading to any concrete action.”
Underscoring investor skittishness and low tolerance for earnings disappointments, French payments firm Ingenico Group plummeted 13.6 percent in heavy volume, after cutting its full-year targets following a “sudden and significant decline” in U.S. sales.
“Ingenico has adjusted its guidance for H2 2016 due to the rapid and temporary market decline in the U.S. caused by the change in EMV rules, and persistently difficult conditions in Brazil,” Richard-Maxime Beaudoux, analyst at Bryan, Garnier & Co, said in a note.
Dutch fertilizer group OCI also dropped, down 6.9 percent after reporting its first half results.
Germany’s blue-chip DAX ended in positive territory, helped by a jump in Fresenius SE. The medical company was up 6.4 percent after it said that it was buying Spain’s biggest private hospital chain, Quironsalud, for 5.76 billion euros ($6.42 billion).