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Europe finishes sharply lower as earnings weigh; mining stocks tumble

Sam Meredith

European stocks posted sharp declines by Thursday's market close, as a string of corporate earnings triggered negative moves across sectors and bourses.

The pan-European Stoxx 600 closed sharply lower, down 1.05 percent provisionally on Thursday, with all sectors and major bourses in negative territory.

Looking to major bourses, the U.K.'s FTSE 100 slipped 0.56 percent, while France's CAC 40 and Germany's DAX tumbled further, closing down 1.00 and 1.33 percent respectively.

Basic resources led the losses Thursday, down almost 2.5 percent around 2:30 p.m. GMT. ArcelorMittal 's shares slumped down almost 3 percent after EU anti-trust regulators said they would investigate whether its proposed purchase of Italian steel plant Ilva would lead to price hikes, Reuters reported. Almost all mining stocks were in the red, on the back of a decline in metal prices.

While all sectors posted declines, Europe's banking index saw some of its stocks rise in afternoon trade. Germany's Commerzbank posted a net profit in the third quarter as the lender continued to focus on a major overhaul. Its shares were 2.5 percent higher on the news.

Several Italian banks were also sharply higher, with BPER Banca up 10 percent, after it strengthened its core capital ratio, Reuters reported. Insurer Aegon also rose sharply, up over 4.5 percent, after its third quarter underlying pretax profit beat market expectations.

German sportswear firm Adidas posted another strong quarter of sales and profit growth Thursday, driven by expansion in China and North America, where it has been taking market share from rival Nike. Its shares were more than 4 percent lower.

Luxury brand Burberry tumbled over 9 percent, with Reuters citing investor concern after the British company outlined Thursday the cost of its new transformation, including store refurbishment.

Vestas meantime slumped to the bottom of the benchmark after the firm lowered its 2017 profit margin outlook. The world's largest maker of wind turbines cited increased competition and uncertainty over U.S. tax reform as likely challenges to its industry over the coming months. Its shares dropped over 18.5 percent.

'Unfair trade practices'

Elsewhere, President Donald Trump 's tour of Asia remained in the spotlight. Trump addressed the U.S.-China trade deficit during a speech in Beijing Thursday, saying he would work on resolving "unfair trade practices."

Back in Europe, Brexit talks resume Thursday with both sides hoping to break a deadlock in negotiations before the end of the year.

With time running out to secure a deal before the U.K. departs the bloc in March 2019, European officials have asked Britain to make a satisfactory offer on the Brexit divorce bill.

European shares came under additional pressure during trade, as U.S. equities posted sharp declines on Thursday, with Wall Street digesting a mixed bag of corporate results from retailers.