By Steve Goldstein, MarketWatch
European stocks weakened Friday after the release of data showing a slowdown in Chinese growth and a warning from French automaker Renault.
The Stoxx Europe 600 /zigman2/quotes/210599654/delayed XX:SXXP -0.98% declined 0.12% to 392.59.
The German DAX /zigman2/quotes/210597999/delayed DX:DAX -0.33% fell 0.03% to 12650.98, the French CAC 40 /zigman2/quotes/210597958/delayed FR:PX1 -1.42% fell 0.34% to 5653.86 and the U.K. FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX -1.59% weakened 0.26% to 7163.94.
China on Friday reported the worst growth in 27 years, as GDP slowed to a 6% year-over-year rate in the third quarter as fixed investment dipped.
“Investment is import intensive, so taxing trade taxes [hurts] investment. Uncertainty about trade also gives companies reason to pause in their investment. However, it is reasonable to suggest that – as long as there are no more trade taxes – the worst of the investment slowdown may be behind us,” said Paul Donovan, an economist at UBS.
Renault /zigman2/quotes/200919924/delayed FR:RNO -2.23% fell 12.7% as the company said its operating margin for the year would be 5% instead of 6%, and that revenue should fall between 3% and 4%.
Deutsche Bank downgraded the stock to hold from buy, as the broker pointed out that rising costs more than lower revenue was responsible for the profit warning. “Thus, there is a risk that the situation will not improve next year since most of these additional costs are expected to be recurrent,” the broker said.
Danone /zigman2/quotes/205561941/delayed FR:BN +2.05% dropped 7.2% as the yogurt maker reported third-quarter organic sales growth of 3%, which was lower than forecast, and cut its annual guidance to 2.5% growth from 3%. Danone said disappointing U.S. yogurt sales and weakness in European bottled water revenue weighed on its results.
Getinge /zigman2/quotes/200454589/delayed SE:GETI.B +1.16% rallied 18% as the Swedish medical technology company reported 4.8% organic sales growth and 3.5% increase in orders during the third quarter.