European Markets Retreated From Recent Highs Tuesday

(RTTNews) - The European markets snapped a recent winning streak on Tuesday, which had brought the markets to or near multiyear highs. Banks and mining stocks were among the weakest performers. The markets retreated despite German investor confidence data, which rose to its highest level in four years. Investors are looking forward to the release of the minutes from the most recent FOMC meeting on Wednesday.

The economic recovery in Eurozone is fragile, but there is no risk of deflation, European Central Bank Executive Board Member Peter Praet said on Tuesday.

In a speech in Frankfurt, Praet said, "A recovery has started, but it is still in its infancy and fragile."

Global environment remains uncertain, structural reform and fiscal sustainability needs to be completed and financial sector regulation must be thoroughly revamped, the policymaker added.

The Organization for Economic Co-operation and Development downgraded its global growth projections, citing worsening outlook for some emerging economies.

In the latest semi-annual Economic Outlook published Tuesday, the Paris-based organization underscored a range of downside risks to the recovery and cautioned that the path is set to be turbulent.

Further, the organization urged policymakers to ensure that instability in financial markets and underlying fragility in some major economies are not allowed to derail growth.

The OECD sees a gradual recovery in the euro area. Eurozone growth is seen at 1 percent in 2014 and 1.6 percent in 2015.

If deflation risks intensify, the ECB should ease policy further. In the banking sector, the asset quality review as well as stress tests need to be implemented rigorously, the agency said. Further progress must be made on establishing a fully fledged banking union.

The Euro Stoxx 50 index of eurozone bluechip stocks declined by 1.02 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 0.65 percent.

The DAX of Germany dropped by 0.35 percent and the CAC 40 of France tumbled by 1.12 percent. The FTSE 100 of the U.K. decreased by 0.38 percent and the SMI of Switzerland fell by 0.61 percent.

In Frankfurt, K+S fell by 3.42 percent. Standard & Poor's lowered its long-term credit rating to BBB from BBB+.

Commerzbank dropped by 1.13 percent and Deutsche Bank lost 0.76 percent.

Pharmaceutical manufacturer STADA Arzneimittel declined by 2.62 percent. Berenberg downgraded the stock to ''Hold'' from ''Buy.''

In Paris, Credit Agricole dropped by 1.48 percent. BNP Paribas and Societe Generale fell by 1.75 percent and 1.86 percent, respectively.

In London, Intertek Group fell by 2.48 percent. The provider of quality and safety services posted 7.6 percent growth in its 10-month revenue and said it agreed to acquire North America's Architectural Testing Inc. for 59 million pounds.

Paddy Power, which issued an interim management statement, sank by 8.44 percent.

easyJet surged by 7.09 percent, after announcing increased annual profit as well as a special dividend.

Technology firm Smiths Group said overall trading for the first quarter has been in line with expectations. The company's expectations for the year remain broadly in line with the previous outlook, although foreign exchange translation is expected to be a headwind at current rates while sales to government-funded customers remain a risk. The stock decreased by 2.30 percent.

Royal Bank of Scotland declined by 1.71 percent and Lloyds Banking lost 1.43 percent. Standard Chartered dropped by 1.15 percent and HSBC fell by 0.26 percent.

Royal DSM advanced by 3.04 percent in Amsterdam. The Life Sciences and Materials Sciences company and middle-market private equity firm JLL Partners agreed to create a new company in a $2.6 billion deal.

Royal KPN rose by 1.27 percent, after Credit Suisse upgraded the stock to "Outperform" from "Neutral."

Eurozone's construction output declined in September for the first time in six months, data released by Eurostat showed on Tuesday. Construction output decreased a seasonally adjusted 1.3 percent from August, when it grew 0.3 percent, which was downwardly revised from 0.5 percent. The latest fall was the first since March.

Europe's new car registrations increased for the second consecutive month in October, data published by the European Automobile Manufacturers' Association showed Tuesday. Car sales gained 4.7 percent from a year ago, following a 5.4 percent rise in September. It was the first time since September 2011 that demand for new cars was up in two consecutive months.

German investor confidence rose to its highest level in four years in November, driven by hopes of economic recovery gaining momentum in the euro area, the results of a closely-watched survey showed Tuesday.

The indicator of economic sentiment for Germany rose for the fourth consecutive month to 54.6 from 52.8 in October, the Mannheim-based Centre for European Economic Research/ZEW said. Economists had forecast a score of 54. The latest reading is the highest since October 2009.

Germany's employment growth maintained a steady pace in the third quarter, data released by the Federal Statistical Office showed on Tuesday. The number of employed grew by 0.6 percent or 253,000 year-on-year in the three months to September. Employment also rose 0.6 percent in the second quarter.

Employee compensation costs in the U.S. rose by slightly less than expected in the third quarter, according to a report released by the Labor Department on Tuesday.

The Labor Department said its employment cost index rose by 0.4 percent in the third quarter following a 0.5 percent increase in the second quarter. Economists had expected the index to rise by another 0.5 percent.