* FTSEurofirst 300 down 0.2 pct, Euro STOXX 50 down 0.3 pct
* Nestle weighs as it warns about slower EM demand
* BNP-Paribas down after profit drop
By Francesco Canepa
LONDON, Feb 13 European stocks snapped a
week-long winning streak on Thursday, weighed down by a batch of
disappointing updates from blue-chip companies including Swiss
food group Nestle and French bank BNP Paribas
Shares in Nestle fell 1.4 percent after it said it may
undershoot its long-term growth targets again this year due to
weaker demand from emerging markets (EM) and price pressures in
French spirits group Pernod Ricard also warned
about weak demand in China on Thursday as it cut its annual
profit growth goal.
An MSCI basket of stocks with the highest proportion of
sales from emerging countries has fallen by more than two
percent this year, underperforming the broader market, as signs
of a slowdown in China and capital flight from other emerging
countries saw traders ditch assets linked to those regions.
"Our view is that there will be some further disappointment
from companies exposed to emerging markets in the fourth quarter
(2013). Difficult to assess, however, what is now included in
share prices as this thematic is very well known" Yann Belvisi,
a strategist at CM-CIC Securities in Paris said.
"Consensus is becoming very bearish on these stocks but we
don't expect EM economies to bottom too low, so opportunities
should materialize later in the year. For the moment we still
recommend that investors...favour exposure to both U.S. and
European economic growth."
The pan-European FTSEurofirst 300 index was down
0.2 percent at 1,323.86 points at 0858 GMT, falling for the
first time in seven sessions. The Euro STOXX 50
index was down 0.3 percent at 3,085.30.
Britain's Rolls Royce, the world's second-largest
aircraft engine maker, was the top faller on the FTSEurofirst
300, down 11.4 percent, after it forecast declining defence
aerospace and marine revenues in 2014.
Also weighing on the index were banks BNP Paribas and
Banking Group, down 4.3 percent and 3.7 percent,
respectively, after their quarterly updates.
BNP Paribas reported a 76 percent drop in quarterly profit
after booking a $1.1 billion litigation provision, triggering a
downgrade to "hold" from "accumulate" at CM-CIC Securities.
Bucking the sector trend was Germany Commerzbank,
which rose 3.1 percent after posting a small profit in the
fourth quarter of 2013 and showing its restructuring had gained
"The earnings flow today is mixed, and we see a couple of
big names being impacted by the crisis in the emerging markets,
so even if the overall picture is relatively positive, investors
have to be selective," a Paris-based trader said.
Nearly halfway through Europe's earnings season, 58 percent
of European companies have met or beaten quarterly profit
forecasts, their best score since the third quarter of 2012,
according to Thomson Reuters StarMine data.
In absolute terms, however, the data shows profits are down
3.5 percent compared to the same quarter a year before.
Europe bourses in 2014:
Asset performance in 2014:
Today's European research round-up