* Auto stocks slide ~3%
* German industrial, investor morale fall, U.S. ISM cools
* BP, Shell, Total fall as oil prices slide
* Alstom falls on downbeat outlook
(Updates to close)
July 6 (Reuters) - European stocks retreated sharply from
two-week highs on Tuesday, breaking a three-day winning streak
as investors flocked to bonds on worries over risks to
rebounding global economic growth.
All major European bourses lost almost 1%, with France's CAC
40 down 0.9% and the oil heavy FTSE 100 posting
its worst session in two weeks, as government bond yields across
the euro area fell to their lowest levels in at least three
weeks.
German investor morale fell by much more than expected in
July but remained at a very high level, a survey showed on
Tuesday, while separate data showed orders for German-made goods
posted their sharpest slump in May since the first lockdown in
2020, hurt by weaker demand from countries outside the euro
zone.
Euro zone monthly retail sales, meanwhile, rose more than
expected in May after a drop in April. But shares in the region
took a sharp turn lower after a survey revealed U.S. service
sector activity cooled in June.
"A downturn in economic data (is) doing little to boost
sentiment around the recovery pathway," said Joshua Mahony,
senior market analyst at IG.
The pan-European STOXX 600 index fell 0.5%, with
the automobiles and parts index sliding the most, down
2.9%. Worries about supply chain bottlenecks have weighed on the
index since it hit 2015 highs in early June.
The oil and gas sector fell 1.8% as oil prices
slipped after an OPEC+ dispute had sent them to multi-year
highs.
Oil majors BP, Royal Dutch Shell and Total
fell between 2% and 4%.
Investors' focus will be on the release of the U.S. Federal
Reserve's minutes of its latest policy meeting on Wednesday as
they look for hints on whether the central bank will roll back
its large stimulus programme.
A strong rebound in euro zone business activity and optimism
about a full reopening of Britain's economy later this month
have helped markets stay afloat so far in July despite rising
cases of the Delta variant of the coronavirus.
French train maker Alstom slumped 8.4% to the
bottom of the STOXX 600 after it forecast negative free cash
flow for its fiscal year.
British online grocer and technology group Ocado
gave back all session gains. It had rallied 4% after posting a
20% rise in retail revenue in the first half of the year and
said it had signed a new deal to develop supermarket chain
Alcampo's online business in Spain.
(Reporting by Sruthi Shankar and Susan Mathew in Bengaluru;
Editing by Shounak Dasgupta and Peter Graff)
