(Reuters) – European shares dipped on Wednesday after hitting eight-month highs in the previous session, as analysts said it was too early to call a recovery in China despite the world’s second largest economy’s better-than-expected first-quarter GDP growth.
The pan-European STOXX 600 index was down 0.1 percent by 0726 GMT after five straight days of gains. Among country indexes, Italy’s posted a modest rise.
China’s economy grew 6.4 percent in the first quarter from a year earlier, defying expectations for a further slowdown, as industrial production jumped sharply and consumer demand showed signs of improvement.
Analysts said it was too early to call a sustainable turnaround there, and further policy support would be needed to maintain momentum.
BHP Group PLC fell 2.7 percent, weighing heavily on London’s FTSE and the STOXX 600 as the world’s biggest miner cut its forecast for iron ore output, a day after rival Rio Tinto slashed its output guidance.
The basic resources sector dropped 1.4 percent.
Bunzl was the worst performer on the pan-European index, down about 12 percent after the business supplies distributor said first-quarter growth slowed as the grocery and retail business in its biggest market – North America – remained sluggish.
Roche rose 1.2 percent as the Swiss drugmaker raised its 2019 outlook after first-quarter sales beat analyst forecasts.
ASML Holding rose more than 1 percent after the semiconductor equipment maker reported better-than-expected first quarter earnings and repeated it expects growth to accelerate through the year.
European chip stocks – AMS, STMicro, Dialog Semi, Siltronic – were up between 0.4 percent and 3 percent after U.S. peer Qualcomm Inc surged on Tuesday on an iPhone modem chips deal with Apple Inc.
Commerzbank shares rose 2.6 percent after a media report that Dutch bank ING added its name to a list of merger suitors. That followed approaches by Deutsche Bank and Italy’s UniCredit
(Reporting by Medha Singh and Susan Mathew in Bengaluru; editing by John Stonestreet)