January 17, 2018 / 8:43 AM / in 9 months

European shares pull back as trading updates disappoint

MILAN, Jan 17 (Reuters) - Earnings updates and dealmaking activity drove the biggest share price moves in Europe on Wednesday as the broader market followed U.S. stocks lower following a strong start of the year.

Britain’s Informa dropped 5.4 percent after it made a paper and cash offer to buy UK events organiser UBM, which shot up 16 percent.

Luxury fashion brand Burberry and educational publishing company Pearson were among the top fallers in Europe after disappointing trading updates.

Their losses along with weakness in the heavyweight financial and healthcare sectors dragged the pan-European STOXX 600 index down 0.3 percent by 0814 GMT. The UK’s FTSE also fell by 0.3 percent.

British contractor Interserve tumbled 10 percent after the Financial Times reported that government ministers are “very worried” and have set up a team of officials to monitor the company following the collapse of competitor Carillion.

Tech was among the few sectors in positive territory, underpinned by a 3.6 percent surge in ASML.

The Dutch chipmaking equipment supplier posted better-than-expected net profit in the fourth quarter as customers asked for early delivery of products as semiconductor demand booms.

Despite Wednesday’s decline, the STOXX remains close to the 2 1/2 year high hit early this month on confidence over the region’s economic recovery and the upcoming earnings season.

“Conditions for a recovery of European equities are there but the over-extension of gains on the S&P 500 represent a risk in the short term,” said Anthilia Capital fund manager Giuseppe Sersale. (Reporting by Danilo Masoni; editing by Tom Pfeiffer)

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