European stock markets lower; autos fall as investors digest earnings

European stocks slid lower Thursday morning, with the Stoxx 600 index down 0.3% and most sectors posting declines.

Autos plunged 2.4% and mining shares fell 1.07%, though banks were a bright spot, up 0.75%.

Germany’s DAX fell 0.54%, France’s CAC 40 was down 0.26% and the U.K.’s FTSE 100 fell 0.12%.

German producer prices declined 2.6% on a monthly basis, while annual inflation cooled from 15.8% to 7.5%.

It was the sixth consecutive monthly fall in prices.

Year-on-year prices remain elevated largely because of energy, the national statistics agency said.

— Jenni Reid

Investment bank UBS has identified global stocks to buy in what could be a year of “slowflation” — a combination of sluggish growth and sky-high inflation.

The Swiss bank’s strategists said they expect weak global growth at 2.6% in 2023, compared to the 50-year average of 3.5%. They also said slower-than-expected progress was being made in bringing core inflation toward central bank targets.

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— Ganesh Rao

Earnings season has kicked off on a positive note, with 10% of the broader index reporting better-than-expected earnings. Of the 53 companies in the S&P 500 reporting so far, 83% have beat Wall Street’s expectations by 6%. Both of those rates are above average.

The broad-based index has seen a modest uptrend in the last few weeks, gaining 7% since it reached a bottom at the height of the banking crisis in mid-March.

— Pia Singh

Tech has been a bright spot in a volatile market this year.

“The leaders this year are definitely Apple and Microsoft,” Louis Navellier, chairman at Navellier & Associates, told CNBC’s “Street Signs Asia” on Wednesday. “They are now the highest weightings ever in the S&P 500.”

But he argued that the “real leader” in the S&P 500 is another stock. He also gave three other stock picks with high expected earnings growth.

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— Weizhen Tan

Morgan Stanley posted earnings per share of $1.70 for the first quarter, greater than the $1.62 estimate from analysts polled by Refinitiv. Overall revenue came in at $14.52 billion, above the $13.92 billion consensus estimate from Refinitiv as equities and fixed income trading units performed better than expected.

One growth area was wealth management, where revenue increased by 11% from a year ago.

The shares, which are outperforming most other banks this year, eased by 2% in early trading despite the positive results.

“The investments we have made in our wealth management business continue to bear fruit as we added a robust $110 billion in net new assets this quarter,” said Chairman and CEO James Gorman in the earnings release. “Equity and fixed income revenues were strong, although investment banking activity continued to be constrained.”

-John Melloy

European markets are heading for a flat to lower open Thursday.

The U.K.’s FTSE 100 index is expected to open 1 point lower at 7,893, Germany’s DAX 9 points lower at 15,885, France’s CAC up 2 points at 7,553 and Italy’s FTSE MIB 14 points higher at 27,406, according to data from IG.

Earnings are set to come from WHSmith, Rio Tinto, Dunelm, Renault, Publicis and Ferragamo. Data releases include preliminary consumer confidence figures for the euro zone in April.

— Holly Ellyatt