European shares are lower towards the close Thursday, as a profit warning from German car maker Daimler has weighed on the broader autos sector. Italian stocks were also leading indices lower amid news two Eurosceptic lawmakers have been given financial responsibilities.
By 1600 BST, the EUROSTOXX 600 was down 0.86%, while the EUROSTOXX 50 lost 1.03%. Regional bourses were also red. The German DAX fell 1.51%, the French CAC was 1.11% in negative territory, the Spanish IBEX was off 0.89% and the Italian MIB was 2.00% in the red.
Daimler profit warning
While the trade tariff war between the US and China has quietened down in terms of rhetoric, the effects of the import tariffs that are set to be in place, are expected to affect some company profits.
German car maker Daimler Wednesday warned that in light of the China and US import tariffs, it has adjusted it’s 2018 profit outlook.
It said that earnings before taxes at Daimler and Mercedes-Benz are both expected to be a little below 2017 levels. That’s a reversal of its previous outlook which was for profits to rise in both divisions.
“From today's perspective, the decisive factor is that, at Mercedes-Benz Cars, fewer than expected SUV sales and higher than expected costs - not completely passed on to the customers - must be assumed because of increased import tariffs for US vehicles into the Chinese market,” Daimler said.
Daimler shares fell 4.43% to trade at €57.77.
Auto stocks lose ground
In the wake of that profit warning, which some analysts had been expecting, particularly as Daimler is shifting much of its car manufacturing processes to China, other European auto stocks were also lower. They included:
- Volkswagen shares lost 3.02% to hit €147.90.
- Fiat Chrysler shares were down 3.88% at €16.96.
- BMW moved 3.20% into the red to trade at €81.00.