Europe open: Stocks in the red as Commerzbank, UBS slide

European stocks fell in early trade as investors sifted through some disappointing corporate releases.

At 0855 BST, the benchmark Stoxx Europe 600 index was down 0.8%, Germany’s DAX was 1.3% weaker and France’s CAC was 0.8% lower.

“European equities are trading lower this morning as mixed to disappointing corporate earnings news out of Europe this morning and somewhat weaker economic data out of China are spoiling the overall appetite for stocks,” said Markus Huber, a trader at City of London Markets.

“Having been spoiled of late by consistently better-than-expected economic readings out of China today's weaker manufacturing data might be pointing towards that the rebound in economic activity could be less pronounced than previously hoped. Furthermore despite QE, low oil prices and a weak euro, corporate earnings within the Eurozone seem to struggle as overall slowing global growth is taking a heavy toll.”

The China Caixin manufacturing PMI fell to 49.4 in April from 49.7 in March, missing economists’ expectations for a reading of 49.9. A reading below 50 indicates contraction.

Basic resources – demand for which is heavily dependent on China – took a hit, with the Stoxx 600 sub-index for the sector down 2.7%.

In corporate news, Commerzbank slid after it said profit in the first quarter halved, with net income down to €163m from €388m the year before.

UBS was under pressure as the Swiss bank’s first-quarter pre-tax profit slumped due to weakness in the wealth management business.

Aberdeen Asset Management dropped after reporting a big decline in first-half profit as it took a hit from emerging-market weakness.

BMW skidded after its first-quarter earnings before interest and tax missed expectations, while Lufthansa flew lower after announcing it will slow the pace of its growth plans this year, as it reported a net loss for the first quarter.

On the upside, BNP Paribas rallied as it posted an increase in first-quarter net profit, while HSBC nudged higher after its first-quarter profit came in ahead of analysts’ forecasts.