By Barbara Kollmeyer
Adidas shares tumbled in Europe on Wednesday after the German sportswear maker cut guidance over a familiar struggle in many sectors — supply-chain worries — in addition to a difficult market in China.
A top decliner, Adidas /zigman2/quotes/206448829/delayed XE:ADS +0.54% fell 5% after saying it now expects full-year top and bottom lines to be at the lower ends of guidance . The sportswear maker reported a 600 million euros ($696 million) hit to quarterly revenue due to a challenging China market, COVID-related lockdowns across Asia and supply-chain disruptions.
Management had guided for those woes in August. Shares have underperformed Nike /zigman2/quotes/203439053/composite NKE +1.47% , Puma /zigman2/quotes/203655455/delayed XE:PUM +0.13% and the global sporting goods sector, year to date, but “are unlikely to recover near-term, we think, until current supply chain and Covid-related disruption diminish.,” Citi analyst Thomas Chauvet told clients in a note.
Still, he said these are “temporary factors” and unlikely to compromise the company’s ambitious “Own the Game” 2025 growth targets introduced in March, and Chauvet is sticking to a buy rating.
Shares of Adidas rival Puma fell 1.7%
The Stoxx Europe 600 index /zigman2/quotes/210599654/delayed XX:SXXP +0.73% slipped 0.2% to 482.12. Of the major regional indexes, the German DAX /zigman2/quotes/210597999/delayed DX:DAX +0.72% was flat, the French CAC 40 /zigman2/quotes/210597958/delayed FR:PX1 +0.20% declined 0.3% and the U.K. FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +1.19% increased 0.5%.
The softer action for stocks came with Wall Street headed for a weaker day of trading as October consumer prices came in higher than expected on several measures. It comes on the heel of a surge in China producer prices to the highest level since 1996 reported on Wednesday. Consumer prices also rose in the country.
In Europe, German consumer prices rose 4.5% on the year, which were in line with the forecasts of economists polled by The Wall Street Journal.
The biggest Stoxx 600 gainer Marks & Spencer /zigman2/quotes/206225481/delayed UK:MKS +2.47% , up 15% after the U.K. retailer swung to a pretax first-half profit and lifted guidance. Just behind it was ITV /zigman2/quotes/205378065/delayed UK:ITV +3.14% , which rose 14%, The U.K. broadcaster said it expects advertising revenue to rise on the year in its crucial fourth quarter, and has struck a long-term commercial partnership deal with Virgin Media.
Another big gainer was Swedish retail chain ICA Gruppen , with those shares up as the company said it has received a takeover offer that values the company at 107.4 billion Swedish kronor ($12.5 billion).
Siemens Energy shares /zigman2/quotes/221435471/delayed XE:ENR -0.91% rose 2.4% after the German energy company reported narrower losses in its fiscal fourth quarter on higher revenue and issued guidance for fiscal 2022. Shares of rival E.ON /zigman2/quotes/206607864/delayed XE:EOAN +0.89% rose 1% after reporting higher profit and sales in the third quarter, and backing its forecasts for the year.
The biggest Stoxx 600 faller was S4 Capital /zigman2/quotes/205349661/delayed UK:SFOR +6.66% , which fell 10% after the digital advertising and marketing-services company reported in-line revenue growth as strong momentum continued in the third quarter.
Infineon Technologies /zigman2/quotes/203152288/delayed XE:IFX -0.43% posted higher profit and revenue in the fourth quarter of fiscal 2021 as it continued to benefit from high demand for semiconductors, and said it expects a strong fiscal 2022. But the German chipmaker’s shares slipped 1%.