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Stocks: banks, big oil sidelined as AZ plunges

Thursday, July 27, 2017 - 01:41

The worst-ever single day drop in AstraZeneca shares dominates early trading on Europe's bourses, while Deutsche Bank lowers its outlook. But, as David Pollard reports, the first results from big oil surprise to the upside.

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BROADCAST AND DIGITAL RESTRICTIONS**Broadcasters: NONE Digital: NONE**~ Everyone expected a steady drip feed of news on Europe's heaviest earnings day. But not the big splash. Astra Zeneca. (SOUNDBITE) (English) HEAD OF CORPORATE DEVELOPMENT, 7IM, JUSTIN URQUHART STEWART, SAYING: "10 billion pounds wiped off a share price in a matter of minutes. I've never seen anything like that of that scale before. Has it been overdone..?" Than an open question as investors reassessed. Astra's admission that its vital MYSTIC lung cancer tests had failed driving its shares down over 15 per cent. (SOUNDBITE) (English) HEAD OF CORPORATE DEVELOPMENT, 7IM, JUSTIN URQUHART STEWART, SAYING: "This one was in Phase 3. If it fails then all that money is wasted, but also the future revenues are lost." On another day, Deutsche Bank might have been the bigger story. Its shares shedding nearly four per cent in early trade on a weaker outlook this year - and a drop in capital markets trading. As investors this time reassessed the turnaround plan of Germany's biggest lender. (SOUNDBITE) (English) HEAD OF CORPORATE DEVELOPMENT, 7IM, JUSTIN URQUHART STEWART, SAYING: "It's still a work in progress. But in terms of the expectations of the market I'm afraid the turnaround plan for Mr. Cryan has not been successful in terms of time scale. That's why you're seeing the share price come back down." And if you're looking for model management, says Urquhart Stewart, go to big oil. Royal Dutch Shell, France's Total and Norway's Statoil reported sharp increases in cash flow from operations in the second quarter - as profits beat expectations. As did Lloyds - reporting its best half-year in eight. Though bigger provisions for pensions misselling drove its share price down too. Against the backdrop of Brexit. (SOUNDBITE) (English) HEAD OF CORPORATE DEVELOPMENT, 7IM, JUSTIN URQUHART STEWART, SAYING: "If the consumer's going to be slowing up, our economy is slowing up, then a company like Lloyds is going to be very exposed." Especially if inflation continues to bite - and consumers make less of a splash with their cash.

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Stocks: banks, big oil sidelined as AZ plunges

Thursday, July 27, 2017 - 01:41