European shares led lower by oil stocks, M&S shines
MILAN, May 23 (Reuters) - European shares retreated on Wednesday as a drop in crude prices weighed on energy companies, while retailer Marks & Spencer (Frankfurt: 534418 - news) was among the biggest gainers after its trading update.
By 0713 GMT, the pan-European STOXX 600 index was down 0.5 percent, pulling back from a 3-1/2 month high hit in the previous session, while the FTSE declined 0.3 percent from a record high reached on Tuesday.
The energy index, the biggest sectoral gainer so far this year in Europe, fell 1.7 percent as the possibility of higher OPEC output sent oil prices lower.
Shares (Berlin: DI6.BE - news) in oil majors Total (LSE: 524773.L - news) , BP and Royal Dutch Shell fell between 1.6 and 2 percent.
Marks & Spencer rose 5.3 percent after it reported full-year results.
While the retailer's update included a second straight decline in annual profit and a 321 million pounds charge for a store closure programme, Morgan Stanley (Xetra: 885836 - news) said the lack of an outlook or dividend cut could trigger a significant short squeeze in its shares.
Banks were in focus after the Financial Times reported that Barclays (LSE: BARC.L - news) is exploring a potential merger with rival banks, including Standard Chartered (BSE: 580001.BO - news) . Sources close to the bank told Reuters that Barclays was not exploring a potential merger.
Barclays shares were little changed, while Standard Chartered rose 1.9 percent.
Italy's FTSE MIB fell 1.3 percent, underperforming the broader European market on ongoing political worries.
(Reporting by Danilo Masoni, Editing by Kit Rees)