LONDON (MarketWatch) — Stocks in Europe couldn’t hold early gains on Wednesday as the market continued to drift after the year-opening rally.
The pan-European Dow Jones Stoxx 600 traded lower, slipping 0.2% to 257.11 in a broad but not heavy downturn.
The most notable faller was Marks & Spencer , which dropped 5.2%. The U.K. clothing retailer said comparable U.K. sales for the 13 weeks to Dec. 26 rose 0.8% from a year earlier, missing consensus expectations for a 1.2% advance.
The company said that after adjusting for the timing of its Christmas sale this fiscal year, which started on Dec. 27, comparable sales were up nearly 2%. See M&S story. See London Markets.
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By region, the U.K. FTSE 100 slipped 0.4% to 5,503.20, the German DAX fell 0.5% to 6,003.71 and the French CAC 40 fell 0.3% to 4,001.06.
Futures on the Dow Jones Industrial Average fell 32 points ahead of data on U.S. employment.
Markit said its euro-zone services PMI rose to 53.6 in December from 53.0 in November. The figure was slightly below its earlier flash estimate of 53.7 but remained the highest reading since November 2007.
The euro exchanged hands at $1.4336, with the shared currency on the move as European Central Bank board member Jurgen Stark told the Italian newspaper Il Sole 24 that Greece won’t get bailed out by the European Union american family insurance.
Greece’s credit rating has been under assault on the country’s massive debt burden relative to GDP.
Of other stocks in the spotlight, Deutsche Telekom fell 2.3% to 10.27 euros after it was cut to sell from neutral by UBS, which said earnings momentum is negative and free cash flow visibility is low.
It sees structural challenges in emerging Europe and at T-Mobile USA, suggesting scope for further downside. UBS kept its price target at 8.70 euros.
Sodexo , the French catering services group, gained 4.7%. It said Wednesday that total sales in its fiscal first quarter, which ended Nov. 30, fell 2.7% to 3.87 billion euros, as a decline in sales to corporate customers was partially offset by stronger sales to hospitals and schools. Sodexo also reaffirmed its targets for fiscal 2010, including for revenue to hold steady from the prior year and for an operating profit of between 750 million euros and 770 million euros.
Analysts at Exane BNP Paribas said the group’s North American performance was better than expected.
French auto maker Peugeot rose 3.6% after it was upped to buy from neutral at Bank of America Merrill Lynch as it expects market share gains to continue into the first half of 2010. The broker is now estimating fourth-quarter revenue growth of 13.9%, bringing its annual revenue estimate of 48.4 billion euros ahead of consensus estimates.
Sonova Holding rose 3.4% after buying InSound Medical, a maker of a hearing aid system that’s not visible from the outside, for at least $75 million.
Europe Markets: Stocks in Europe drift lower; M&S retreats
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