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European shares fall as growth worries linger; AMS rises

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By Reuters
European shares fall as growth worries linger; AMS rises
FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, April 29, 2019. REUTERS/Staff   -   Copyright  STAFF(Reuters)

(Reuters) – European shares fell on Tuesday as a decline by banks and weak China factory data offset a surge in shares of chipmaker AMS, while investors waited for euro zone economic growth numbers.

The pan-European STOXX 600 index edged lower by 0725 GMT. Most major indices fell except London’s FTSE 100, which was little changed.

China’s manufacturing activity failed to meet expectations, underscoring weakness in the world’s second-largest economy.

In contrast, French economic growth held steady in the first quarter and Spain’s preliminary gross domestic product beat expectations. Investors now are waiting for economic growth data for the euro zone later in the day.

Banks were the biggest weight on the STOXX 600. Danske Bank, caught up in a money-laundering scandals, fell more than 6 percent after lowering its outlook for 2019. Santander, the euro zone’s biggest bank by market value, also slipped after first-quarter net profit.

Nordea Bank and BBVA also reported lower profits and fell more than 2 percent each.

Standard Chartered, however, advanced after the bank announced plans for up to $1 billion of share buybacks, its first in at least 20 years.

Airbus slipped after the European planemaker reported a heavy drain on cash, which overshadowed slightly higher-than-expected core first-quarter profits.

Rising fuel costs and excess capacity in Europe dragged German airline Lufthansa into a first-quarter loss. The stock shed 3 percent.

Among the bright spots, chipmaker AMS jumped 16 percent, boosting the tech index, after it beat forecasts for first-quarter profit and gave an upbeat outlook for the second quarter.

An Apple supplier, the AMS results came before Apple’s on quarterly report, due late on Tuesday.

The world’s top maker of semiconductors, Samsung Electronics Co Ltd, reported weak quarterly profit but forecast a recovery in demand in the second half of the year.

Apple, General Electric and McDonald’s are all due to report their earnings later in the day.

(Reporting by Agamoni Ghosh and Medha Singh, editing by Larry King)