(Bloomberg) -- European stocks fell for a fifth day as a series of technical glitches swept around the world, hitting trading, travel and support services.
The Stoxx 600 Index ended the session with a loss of 0.8% to notch its worst week since October. Travel and leisure stocks were among the day’s biggest losers, as airlines, hotels and other companies grappled with tech issues. All other European sectors were also in negative territory.
While trading across the region proceeded as normal, there was no pricing data for FTSE indexes, including the FTSE 100 and FTSE MIB benchmarks, for four hours, even though stocks in the UK and Italy continued to trade. The LSE Group, which operates the London stock exchange, also said it had experienced a technical issue.
“Derivatives professionals, market making on indexes and rates for instance are all affected by the situation,” said Anthony Cohen, a global options and futures broker at Market Securities.
Companies globally, from McDonald’s Corp. to United Airlines Holdings Inc. disclosed a variety of issues with communications to customer service. Air France-KLM’s Dutch arm said it was forced to suspend “most operations.”
“Having so much of the world’s infrastructure relying on such a small number of companies and systems has the potential to magnify the negative impact of issues like this,” said James Athey, a portfolio manager at Marlborough.
Disappointing earnings updates further soured the mood. Germany’s Sartorius AG slumped after cutting its outlook, while delayed launches of two video game titles weighed on Ubisoft Entertainment SA’s update. Gaming firm Evolution AB also tumbled after its earnings missed estimates, a result that impacted other gambling stocks in the leisure sector.
European stocks have fallen from recent peaks, amid concerns over company earnings, the path of interest rates and developments in the race to the US White House. While the European Central Bank gave away little in terms of its plans after leaving rates unchanged on Thursday, recent political turmoil in France has given some investors pause.
Nadege Dufosse, global head of multi-asset at Candriam, said that she has reduced exposure to Euro zone equities, adding that UK equities look much more attractive.
“In Europe, politics also has an impact because of French elections. It has, in our view, increased the risk premium on European assets, and the economy is rather sluggish in Europe,” Dufosse said by phone.
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--With assistance from Michael Msika and Farah Elbahrawy.
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