Tech stocks weigh on Europe, Brexit delay looms
By Lisa Pauline Mattackal and Agamoni Ghosh
(Reuters) - European shares dipped for the first time this week on Wednesday, as warnings from Texas Instruments raised concerns about the global microchip industry, while UK lawmakers hit the pause button on Britain's exit from the European Union.
European tech stocks <.SX8P> were set for their worst day in two weeks, dragged down by chipmakers Infineon
The pan-European STOXX 600 index <.STOXX> fell 0.1% as the Brexit saga hit another snag after British lawmakers rejected Prime Minister Boris Johnson's timetable.
"We don't think the chances of a no-deal Brexit have increased, but the chance of a delay has definitely soured the mood," said Hubert de Barochez, markets economist at Capital Economics.
European stock markets have been rattled in the past few months by geopolitical concerns, a prolonged U.S.-China trade war and a manufacturing recession in the bloc's biggest economy, Germany.
After solid gains in the first quarter, the benchmark index lost steam in the second and third. It kicked off October with its smallest quarterly increase this year.
With the focus now squarely on corporate earnings, analysts expect a drop of as much as 5.3% in third-quarter profit, worse than the 3.7% fall expected a week ago, according to IBES data from Refinitiv.
Mining stocks <.SXPP> were the best performing European sector, lifted by a smaller-than-expected drop in quarterly profit at aluminum producer Norsk Hydro (NASDAQ: NHY).
Auto stocks <.SXAP> were up 0.3% as PSA Group
Shares of Covestro AG <1COV.DE> rose 2%, lifting the chemicals sub-sector <.SX4P> 0.5%.
Meanwhile, Brexit-sensitive FTSE midcap stocks <.FTMC> slipped 0.2%, underperforming their European peers, but losses were capped as the chances of a no-deal Brexit diminished.
(This story corrects to remove reference to Covestro's profit outlook in paragraph 11. The company is scheduled to report third-quarter results on Oct. 28)
(Reporting by Lisa Pauline Mattackal in Bengaluru; Editing by Shounak Dasgupta and Arun Koyyur)