Politics

Tech, Boeing suppliers drag European shares lower

Single dollar bills mashed up with U.S. flag

(Updates prices; adds details, comment)

By Susan Mathew and Medha Singh

April 8 (Reuters) - European stocks fell on Monday followinga week of strong gains, with losses in technology stocks andEuropean suppliers of U.S. planemaker Boeing, weighing the most.

Stocks in Spain.IBEX fell the most, down 0.73 percent,while Germany's trade sensitive DAX index .GDAXI fell 0.5percent, breaking a seven day winning streak - its longest sinceOctober 2017.

Earlier on Monday data showed that German exports andimports fell more than expected in February, the latest signthat Europe's biggest economy will likely post meager growth inthe first quarter.

"It's a very, very slow start, with most sectors down with alittle bit of profit taking after last week," said Mark Taylor,sales trader at Mirabaud Global Thematic Group in London.

Taylor also said there was a 'buying drought' given theabsence any new headlines on trade, with investors watching forBrexit developments, the European Central Bank's policy meetingand China data at the end of the week.

The European Central Bank is expected to hold borrowingcosts on Wednesday amid slowing growth indicators, while laterin the week, China is expected to report loan growth, inflationand trade data.

In Spain, airports operator Aena AENA.MC was among thebiggest drags on the index, after RBC downgraded the stock to'underperform' from 'sector perform' as it expects regulatoryrisk to be priced in over the next 12 months.

Software company SAP SAPG.DE , Europe's most valuabletechnology company, weighed the most on the STOXX 600 index,with shares down about 2 percent after it said the head of itscloud business group had quit, the latest in a string of topdepartures.

Boeing'sBA.N European suppliers SafranSAF.PA , Melrose MRON.L and MeggittMGGT.L came under pressure after theplanemaker said it would cut monthly output of its 737 aircraftby nearly 20 percent in the wake of two deadly crashes.

Meanwhile, French rival Airbus AIR.PA rose 0.9 percent.

Continental AGCONG.DE slipped 1.8 percent as KeplerCheuvreux downgraded the auto parts maker to "hold" from "buy".

Auto stocks .SXAP regained some of their early lossesafter a near 7 percent surge last week, including Daimler DAIGn.DE which had been weighed down by the prospect ofpotentially hefty fines after EU antitrust regulators chargedthe company along with VolkswagenVOWG.DE and BMWBMWG.DE with colluding to block the rollout of clean emissionstechnology.

"These are minor moves given the rally the auto sector hashad over the past two or three weeks. If anything, the sectorhas rallied off its lows so it seems like there is still moneyto get out there," Taylor said.

Italian-U.S. carmaker Fiat Chrysler Automobiles NV (FCA) FCHA.MI gains also helped cap declines in the auto sector.

Fiat Chrysler agreed to pay electric carmaker Tesla IncTSLA.O hundreds of millions of euros to allow Tesla vehiclesto be counted in its fleet to avoid fines for violating new EUemission rules.

Deutsche BankDBKGN.DE and CommerzbankCBKG.DE droppedafter European bank supervisors demanded a detailed roadmapoutlining the pace and scale of staff cuts in the two lenders asthey explore a merger, according to German daily Handelsblatt'sreport.

Irish stocks .ISEQ , a barometer of Brexit sentiment, endeda six-day winning run.

Britain's government held out the possibility of compromisewith the opposition Labour Party on Sunday to try to win supportin parliament for leaving the European Union with a deal. UKPrime Minister Theresa May heads to Brussels this week to askfor a further delay until June 30.

(Reporting by Susan Mathew and Medha Singh in BengaluruEditing by Raissa Kasolowsky) ((susan.mathew@thomsonreuters.com; +91-80-6749-1130; ReutersMessaging: susan.mathew.thomsonreuters.com@reuters.net))


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