European shares hit reverse as Schaeffler slump drags autos

LONDON, June 27 (Reuters) – A drop in autos stocks after
Germany’s Schaeffler cut its profit outlook and disappointment
over a failed buyout of Stada hit European shares on Tuesday,
offsetting gains among basic resources firms and Spain’s Bankia.

The pan-European STOXX 600 index fell 0.3 percent,
and blue chips were 0.4 percent lower. Germany’s DAX
was 0.4 percent weaker.

Autos were the biggest pain point in Europe, falling
1.4 percent after German auto parts supplier Schaeffler
slashed its profit guidance on growing price
pressures and high costs.

Schaeffler’s shares tumbled 11 percent, set for their
biggest one-day fall since its 2015 IPO.

German drugmaker Stada was another sizeable
faller, dropping 6.7 percent after private equity groups Bain
Capital and Cinven failed to win the required shareholder
acceptances to take over the firm. So far this year Stada’s
shares have rallied nearly 26 percent, boosted by buyout talks.

Spanish banks were a bright spot as investors cheered
Bankia’s move to buy smaller peer BMN in a deal worth
around $924 million, a further step in cleaning up Spain’s
beleaguered banking sector. Bankia’s shares rose more than 4

Gains among mining firms Anglo American, Rio Tinto
and BHP Billiton helped prop up the basic
resources sector, which gained 1.3 percent. Britain’s
commodities-heavy FTSE 100 <.FTSE. index was flat.
(Reporting by Kit Rees, Editing by Vikram Subhedar)