European stocks decline for a second day as Greece leads losses

European stocks declined for a second day, erasing earlier gains, as Greek equities led losses.

The Stoxx Europe 600 Index slipped 0.2 percent to 367.86 at 10:56 a.m. in London. The gauge rose as much as 0.7 percent and retreated as much as 0.5 percent earlier. The ASE Index lost 6.7 percent, the most among 18 western European markets, as the National Bank of Greece SA and Piraeus Bank SA tumbled more than 20 percent.

Greek stocks slid for a third day, following bonds lower, amid concern a newly formed SYRIZA-led coalition will challenge austerity measures imposed in the debt-ridden nation. The government also opposed moves by the European Union to impose more sanctions on Russia.

“The Greece situation shows that none of the fundamental issues have been resolved,” said Lex Van Dam, a fund manager at Hampstead Capital LLP in London. “The market is looking for leadership after the fast rally post ECB. The European rally has mainly been based on short term speculative flows, which can leave as quickly as they came in. Earnings have been concerning, as we saw with Siemens.”

Europe’s benchmark measure slid 1 percent on Tuesday, snapping the longest streak of gains since April, as Siemens AG and Royal Philips NV posted disappointing earnings. The Stoxx 600 rose for eight days through Monday as the European Central Bank announced a 1.1 trillion euro ($1.25 trillion) bond-buying plan on Jan. 22.

Among stocks moving after results, Roche Holding AG dropped 1.6 percent as the world’s biggest seller of cancer drugs posted 2014 earnings that missed estimates. Johnson Matthey Plc slumped 6.6 percent after reporting third-quarter results. JPMorgan Chase & Co. cut its price target on the company, citing lower operating profit at its Process Technologies group.

Nordea Bank AB climbed 5.9 percent after raising its 2014 dividend. Electrolux AB jumped 11 percent as Europe’s biggest appliances maker said fourth-quarter operating profit increased.

In the US, the Federal Open Market Committee releases its policy statement after European markets close. Policy makers will retain language pledging to be “patient” on the timing of an interest-rate increase, economists said. Standard & Poor’s 500 Index futures were little changed. [Bloomberg]