LONDON: European stocks clung to record highs Monday, with the benchmark Stoxx Europe 600 withstanding losses among miners after dim outlooks for the iron-ore sector.
The Stoxx Europe 600 SXXP, +0.17% closed up 0.2% at 413.63, Gains for telecom, technology, utility, energy and financial shares helped the pan-European index close at a record. Last week, the benchmark broke through the record closing high that had stood for 15 years.
But on Monday, basic resources stocks SXPP, -0.87% dipped as analysts at Citigroup cut their stance on the iron-ore sector to neutral from bullish, in line with major forecast revisions by Citi’s commodity team.
Separately, Standard & Poor’s cut its iron-ore price forecasts for 2015, 2016 and 2017, and placed several iron-ore producers on watch for possible ratings downgrades. “In our view, lower iron ore prices may not only weaken producers’ operating cash flows and financial leverage, but may also affect the long-term resilience of some companies’ business risk profiles, given the higher-than-anticipated earnings volatility due to iron-ore-price swings.
