European shares dip as U.S. tax bill gets muted reception

By Julien Ponthus

LONDON (Reuters) - European stocks followed Wall Street and Asian bourses lower on Thursday in a muted response to the U.S. Congress's approval of a long-anticipated tax overhaul.

The pan-European STOXX 600 index (STOXX) was down 0.2 percent, with major European bourses trading sideways.

Spain's IBEX (IBEX) was down 0.4 percent, slightly worse than Germany's DAX (GDAXI) and Paris CAC 40 (FCHI), which were both down 0.2 percent.

The Spanish government hopes a regional election will strip pro-independence parties of their control of the Catalan parliament.

Describing the muted market reaction to the U.S. 1.5 trillion dollar tax bill, Henry Croft of Accendo Markets described "a widely touted ‘buy the rumor, sell the fact’ event" and said investors were now focused on whether the tax reform would boost equities in 2018.

Other analysts believe investors will need time to crunch the data and figure out which companies will benefit the most.

"As people sharpen their pencils and figure out which companies will benefit (from the tax bill), and companies start talking about that themselves, I think we'll see larger moves in share prices," said John Carey, portfolio manager at Amundi Pioneer Asset Management in Boston.

Nokia (HE:NOKIA) posted the best performance of the STOXX 600, rising 2.6 percent after announcing a patent agreement with China's Huawei (SZ:002502).

Britain's Balfour Beatty added a 2.4 percent rise after it said on Thursday it had agreed to sell a 12.5 percent stake in M25 motorway operator Connect Plus for 103 million pounds ($137.6 million), helping push up 2017 profit and generating funds to pay down debt.

Scandal-hit Steinhoff (DE:SNHG) posted the worst fall, down 12.6 percent and hitting a low 0.26 euro.

In the banking sectors, Commerzbank (DE:CBKG) was down 1 percent after the CEO of Italy's biggest bank, UniCredit (MI:CRDI), said he was not considering taking over the German bank.

Still in banking, Deutsche Bank (DE:DBKGn) lost 1.5 percent. It said on Wednesday it would aim to cut up to 1,000 jobs as part of the planned integration of retail arm Postbank.

Energy was the only sector trading in the black with Norway's Statoil (OL:STL) rising 0.6 percent after presenting plans to extend output from the North Sea Snorre oilfield.

Heavily indebted telecoms and cable group Altice (AS:ATCA), also made it to the top risers of the session. Citigroup (NYSE:C) analysts lowered their price target but kept an overall "buy" rating on the stock, which has slumped nearly 60 percent so far in 2017 due to concerns over its 50 billion euros debt pile.