# Basic material, luxury stocks drive European shares to a third day of losses Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2021-07-16 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: European Stocks Fall on Rio Tinto Slump Meta Description: Get the latest updates on European stocks falling due to Rio Tinto's iron ore exports decline and worries about luxury brands during the COVID-19 spike. URL: https://financedigest.com/basic-material-luxury-stocks-drive-european-shares-to-a-third-day-of-losseshtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2021-07-16t073715z1lynxmpeh6f0b3rtroptp4europe-stocks-1736838168539-compressed.jpg) By Sruthi Shankar and Susan Mathew (Reuters) – European stocks fell on Friday as a slide in Rio Tinto’s iron ore exports hammered mining majors, while strong earnings from luxury brands were overshadowed by concerns about their sustainability amid surging COVID-19 cases. The pan-European STOXX 600 index reversed early gains to end lower for a third straight session, down 0.3%, taking weekly losses to 0.6%. The mining index [slumped 2.8% as Rio Tinto slipped 3.4% after reporting a 12% fall in quarterly iron ore shipments ahead of earnings](https://www.financedigest.com/roche-flags-2023-earnings-decline-on-slump-in-covid-products.html "Roche flags 2023 earnings decline on slump in COVID products"), and dragging other big names such as BHP and Glencore 1.5% and 3.5% lower respectively.\[MET/L\] [Concerns about higher inflation and rising](https://www.financedigest.com/shares-rise-but-concern-mounts-over-inflation-flare-up.html "Shares rise, but concern mounts over inflation flare-up") COVID-19 infections causing a slowdown in economic recovery have weighed on investors’ minds this week, driving many to the safety of bond markets and making it harder for record-high equities to build on gains. “On one hand, a strong start to U.S. Q2 earnings season and dovish rhetoric from [central banks](https://www.financedigest.com/stock-pickers-reckon-its-time-to-move-on-from-central-banks.html "Stock pickers reckon it’s time to move on from central banks") continued to provide support. (But), several factors have weighed on the outlook, including weaker activity [data out of China](https://www.financedigest.com/stocks-sag-as-hawkish-fed-cools-china-rally-awaits-us-jobs-data.html "Stocks sag as hawkish Fed cools China rally; awaits US jobs data"), signs that growth and earnings have peaked,” said Silvia Dall’Angelo, senior economist, at the international business of Federated Hermes. Eyes next week will be on the [European Central Bank](https://www.financedigest.com/european-central-bank-to-raise-deposit-rate-to-3-25-by-mid-year-reuters-poll.html "European Central Bank to raise deposit rate to 3.25% by mid-year: Reuters poll") meeting, to see if a change in monetary policy is on the cards following its recent strategy update. Sweden’s Ericsson lost 9.4%, after the telecoms company after it reported second-quarter core earnings below market estimates, [hit by a decline in sales in mainland China](https://www.financedigest.com/asia-shares-weigh-china-risks-yen-hits-6-month-high.html "Asia shares weigh China risks, yen hits 6-month high"). Luxury stocks tumbled with Burberry down almost 5% [despite strong sales](https://www.financedigest.com/bentley-cruises-to-record-sales-in-2022-despite-china-drop.html "Bentley cruises to record sales in 2022 despite China drop"). No [change to full-year forecast could signal](https://www.financedigest.com/stocks-dollar-little-changed-as-inflation-data-sends-mixed-signals.html "Stocks, dollar little changed as inflation data sends mixed signals") the improvement cannot be sustained, an analyst said. Richemont also lost 0.9% despite strong results, while Louis Vuitton owner LVMH’s 1.3% slide weighed the most on the STOXX 600 and helped push France’s CAC 40 to its third straight [weekly loss](https://www.financedigest.com/dollar-retreats-headed-for-biggest-weekly-loss-since-mid-january-bitcoin-down.html "Dollar retreats, headed for biggest weekly loss since mid-January; bitcoin down"). Defensive sectors were the gainers, with [real estate](https://www.financedigest.com/gold-london-real-estate-and-the-theresa-may-effect.html "GOLD, LONDON REAL ESTATE AND THE THERESA MAY EFFECT"), utilities and healthcare rising between 0.5% and 1% as worries about the coronavirus remained. England’s coronavirus crisis could return again surprisingly quickly, the British government’s chief medical adviser said, ahead of lifting of all pandemic-led restrictions on Monday [despite rising](https://www.financedigest.com/soccer-european-revenues-rise-10-in-2020-21-despite-covid.html "Soccer-European revenues rise 10% in 2020-21 despite COVID") COVID-19 cases. Travel and leisure [stocks gained](https://www.financedigest.com/stocks-dollar-gain-on-resilient-u-s-economy.html "Stocks, dollar gain on resilient U.S. economy") 0.4%, with shares in UK’s Whitbread, Intercontinental Hotels and British-Airways owner IAG up almost 3%. \[.L\] President Joe Biden said on Thursday the United States is reviewing when it can lift [restrictions that ban](https://www.financedigest.com/86-of-parents-believe-there-should-be-either-a-total-ban-or-heavily-restricted-use-of-smartphones-in-schools.html "86% of parents believe there should be either a total ban or heavily restricted use of smartphones in schools") most-non U.S. citizens from travelling to the United States from much of Europe. Topping the pan-region index on the day was a 14% surge by [tech company](https://www.financedigest.com/uk-to-fine-tech-companies-that-fail-to-remove-self-harm-material.html "UK to fine tech companies that fail to remove self-harm material") Sinch, while other Swedish names such as Getinge and Addtech followed, rallying after positive earnings updates. (Reporting by Sruthi Shankar in Bengaluru; editing by Uttaresh.V and Toby Chopra) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---