The Stoxx Europe 600 Index dropped 0.8 percent to 341.65 at 1:11 p.m. in London. A gauge of oil and gas companies lost 1.9 percent, posting the biggest decline among 19 industry groups as oil extended a five-year low. The broader European gauge has fallen 1.6 percent this month, with Greek equities slumping on concern about the implications of early parliamentary elections.
“It hasn’t been a fantastic year for equities, and now those who can, are taking profits,” Luca Paolini, chief strategist at Pictet Asset Management Ltd., said by phone from London. “The concerns about Greece and the euro zone, the price of oil, and the Fed hiking rates are not critical, but they do add up. There is this feeling that the good years of the bull market are behind us. Next year will be more difficult.”
The Stoxx 600 has trimmed its annual advance to 4.1 percent. Greece’s ASE Index slid 15 percent this month as Prime Minister Antonis Samaras failed a third time to get enough backing for his presidential candidate, prompting him to recommend snap parliamentary elections. He is meeting with President Karolos Papoulias in Athens today to request elections on Jan. 25. The opposition Syriza party leads polls as it pushes to abandon the austerity measures tied to Greece’s bailout.
The slump in Greek equities is affecting other countries in Europe’s periphery. Portugal’s PSI 20 Index lost 2 percent today and Spain’s IBEX 35 Index fell 1.2 percent.
Low Volume
The volume of Stoxx 600 shares changing hands today was 38 percent lower than the 30-day average, data compiled by Bloomberg show.
Total SA and BP Plc were some of the companies contributing the most to the Stoxx 600’s decline. Oil retreated for a fourth day amid speculation that U.S. inventories will stay at the highest level since June, offering no relief from a global glut.
The Stoxx 600 had rallied in the past two weeks as energy shares rebounded from a slump, the Federal Reserve said it will be patient in the timing of interest-rate increases, and the U.S. economy expanded at a faster pace than forecast.
Next Plc added 3.6 percent, the most in a year. The clothes seller said the outlook for U.K. retail is improving after it reported Christmas-season sales that beat analysts’ estimates.
