Feb. 11 (Bloomberg) -- European stocks dropped, erasing their gain for the week, as Nokia Oyj slumped and Egyptian President Hosni Mubarak refused to step down immediately. U.S. index futures and Asian shares slid.
Nokia tumbled 8.2 percent after announcing that it will form a software partnership with Microsoft Corp. L’Oreal SA sank 5.2 percent after the world’s largest cosmetics maker reported profit that failed to beat analysts’ estimates. Michelin & Cie. climbed 1.3 percent as the world’s second-largest tiremaker announced that full-year profit exceeded analysts’ projections.
The Stoxx Europe 600 Index lost 0.6 percent to 285.19 at 10:08 a.m. in London, heading for a weekly drop of 0.2 percent. The gauge reached the highest level since September 2008 earlier this week, pushing the measure to about 16 times the reported earnings of its companies, near the highest level in nine months, according to data compiled by Bloomberg.
“Geopolitical risk is rising,” said Scott Lim, who oversees the equivalent of $670 million of assets as chief executive officer at Kuala Lumpur-based MIDF Amanah Asset Management Bhd. “We have to see how the transition is going to take place. It will only be a major concern if the situation runs out of control.”
In Egypt, Mubarak handed day-to-day powers to Vice President Omar Suleiman, while reiterating that he plans to stay on until elections in September, prompting U.S. President Barack Obama to urge the country’s authorities to take further steps to resolve the crisis.
Futures contracts on the Standard & Poor’s 500 Index expiring in March lost 0.5 percent. The MSCI Asia Pacific Index retreated 0.7 percent.
U.S., European Earnings
Some 74 percent of the 329 companies in the S&P 500 that have reported results since Jan. 10 topped per-share earnings projections, according to data compiled by Bloomberg. In Europe, 56 percent beat forecasts, the data show.
Nokia plunged 8.2 percent to 7.49 euros after the world’s biggest maker of mobile phones announced that it will use Microsoft’s Windows as its primary software platform.
L’Oreal declined 5.2 percent to 84.82 euros after the maker of Maybelline lipstick posted 2010 net income that rose to 2.24 billion euros from 1.79 billion euros a year earlier. That missed the average profit estimate of 10 analysts surveyed by Bloomberg of 2.27 billion euros. UBS AG downgraded the shares to “neutral” from “buy,” saying the results were “slightly disappointing.”
ThyssenKrupp, Casino
ThyssenKrupp AG fell 2.3 percent to 30.41 euros as Germany’s largest steelmaker reported earnings that matched analysts’ predictions. ThyssenKrupp posted adjusted earnings before interest and taxes of 273 million euros in the three months through December, compared with 277 million euros a year earlier. That almost matched the average estimate of 12 analysts surveyed by Bloomberg of 271 million euros.
Ocado Group Plc sank 16 percent to 239.5 pence, its largest decline since its initial public offering last July, as John Lewis Partnership Pensions Trust sold its entire stake in the online grocer at 265 pence a share.
Energy companies advanced as Mubarak’s refusal to resign stoked concern that renewed turmoil may disrupt oil supplies through the Suez Canal. TGS-Nopec Geophysical Co. ASA, a Norwegian surveyor of oil deposits, rose 3 percent to 141.70 kroner.
Michelin gained 1.3 percent to 57.81 euros after the tiremaker reported 2010 net income of 1.05 billion euros, exceeding the average analyst estimate of 911 million euros. Michelin also named Jean-Dominique Senard to succeed Michel Rollier as chief executive officer. Rollier, 67, will hand over the CEO post to Senard, 58, in the coming months, following a vote by shareholders at an extraordinary meeting May 13. Senard joined Michelin in 2005 as finance chief.
--With assistance from Chan Tien Hin in Kuala Lumpur. Editors: Will Hadfield, Andrew Rummer
To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net
To contact the editor responsible for this story: David Merritt at dmerritt1@bloomberg.net
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