European stocks down from all time highs ahead of earnings season

European stocks eased from alltime highs on Monday as investors held off from making big bets ahead of the earnings season, while British retailers reopened as the economy emerges from a strict winter lockdown.

The pan-European STOXX 600 index fell 0.4% after closing at a record high on Friday, with banks, commodity and retail sectors among the biggest decliners.

Asian markets slid as investors waited to see if U.S. earnings can justify sky-high valuations, while concerns about a surge in global COVID19 cases also weighed.

MSCI’s All Country World Index, which tracks stocks across 49 countries, was down 0.25% after the start of European trading, off Friday’s record high. The gauge’s price-toearnings ratio is at its highest level since early 2010.

European earnings will kick into higher gear later in April, with analysts expecting a 47.4% jump in first-quarter earnings for STOXX 600 companies, according to Refinitiv IBES data. Much of the support is likely to come from consumer cyclicals and industrial companies.

UK’s domestically focussed FTSE mid 250 index slid 0.5%, but hovered below a record high as shops, pubs, gyms and hairdressers reopened after three months of lockdown.

Airlines EasyJet and Ryanair fell close to 3% after HSBC downgraded the stocks to “hold” from “buy”. Meanwhile, Norway’s budget airline Norse Atlantic rose 4.5% in its stock market debut. Italian diagnostics group DiaSorin SpA jumped 8.6% after it said it will acquire U.S. based Luminex Corp for $1.8 billion. French utilities Veolia and Suez gained almost 8% after they agreed upon a merger deal. Utilities and automakers were the only gainers among European sectors.

Gold prices were idling at $1,737 an ounce, having failed to sustain a top of $1,758 last week. Oil prices edged higher in rangebound trade on Monday on optimism over a rebound in the U.S. economy as coronavirus vaccinations accelerate, though rising COVID-19 cases in other parts of the world kept a lid on prices. Brent rose 1% to $63.61 a barrel. U.S. crude rose 0.9% to $59.86.