European shares slip as weak oil weighs on energy, mining stocks

  • Reuters
  • Stock Market News
European shares slip as weak oil weighs on energy, mining stocks
Credit: © Reuters.

* STOXX 600 down 0.7 pct at close

* Oil drop weighs on energy shares, miners

* Eurotunnel falls as Barclays (LON: BARC ) cuts to sell

* Germany's DAX hits fresh record high (Adds detail, updates prices at close)

By Helen Reid and Kit Rees

LONDON, June 20 (Reuters) - Stocks sensitive to the price of oil fell on Tuesday, putting pressure on European shares, with the pan-European benchmark ending lower after a strong start to the session.

Euro zone blue chips .STOXX50E closed 0.4 percent lower and the regional STOXX index .STOXX fell 0.6 percent, retreating from a two-week high and giving up most of the gains made in the previous session.

Europe's oil and gas companies .SXEP fell more than 2 percent with Royal Dutch Shell (LON: RDSa ) RDSa.AS down 2.3 percent and BP BP.L down 2.6 percent after oil prices hit seven-month lows O/R . Mining shares .SXPP fell more than 3 percent.

"People are once more paying attention (to) the fundamentals and the heavy oversupply that we're seeing on the oil market, and that's really causing some downside pressure," said Jonathan Roy, advisory investment manager at Charles Hanover Investments.

Britain's FTSE 100 .FTSE index, the worst-performing major benchmark in Europe this year, fell 0.7 percent, hit by its heavy weighting in commodities stocks.

"Investors across Europe are taking cue from the downside we're seeing in London and, looking at the quite heavily overbought conditions that we're seeing in Europe, are taking that as a cue to take some money off the table," Charles Hanover Investments' Roy added.

Aside from the slide in oil-related stocks, Germany's Prosiebensat 1 PSMGn.DE was a bright spot, after it sold its online travel agency Etraveli to CVC. Germany's benchmark DAX .GDAXI index touched a fresh record high before retreating 0.6 percent. are slightly surprised that the company did not sell a group of travel assets, but management suggests the rest of the travel portfolio remains under review," they added.

Among the stocks falling the most was Groupe Eurotunnel GETP.PA , which runs Eurostar trains; the shares fell 6 percent after the second broker downgrade in as many weeks. Barclays cut the company to "sell", citing slowing traffic and recent militant attacks, which could weigh on tourism action also took Domino's Pizza DOM.L shares to fall 6.5 percent to 16-month lows. Investec began its coverage of the stock with a "sell" rating, saying that it expects like-for-like growth to slow in British services office provider IWG IWG.L were the biggest fallers, down more than 7 percent after founder and CEO Mark Dixon sold down his stake real estate company Castellum CAST.ST fell 4.3 percent after pension fund AP2 sold the majority of its stake. europe this year


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