UPDATE 2-Swiss stocks keep a lid on European shares as pharma drag lingers

Reuters

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    * STOXX 600 witnesses fist weekly loss since May 
    * Healthcare extends losses led by Swiss drugmakers
    * Daimler falls after profit alert

 (Recasts, updates to close)
    By Agamoni Ghosh
    July 12 (Reuters) - European shares were little changed on
Friday as drugmakers came under pressure on worries the U.S.
government may intervene over high drug prices, while Federal
Reserve chairman Jerome Powell's dovish comments helped limit
losses. 
    The pan-European STOXX 600 index  .STOXX  ended flat but 
broke a five-week winning streak as regional equities failed to
take advantage of the Fed's accommodative stance this week. 
    Swiss stocks  .SSMI  underperformed, sliding more than 1% as
drugmakers including Roche Holdings  ROG.S , Novartis  NOVN.S 
and Novo Nordisk  NOVOb.CO  fell more than 2%. 
    European drugmakers have weighed on the healthcare index
 .SXDP  since Thursday after the White House scrapped an
ambitious health rebate plan and raised the possibility of U.S.
lawmakers intervening on high drug prices.  urn:newsml:reuters.com:*:nL4N24C2KC   
    Auto stocks  .SXAP  recovered from the previous session to
close nearly 1% higher, although Daimler  DAIGn.DE 
underperformed after the world's largest truckmaker warned
investors it expected to swing to a second-quarter loss.
 urn:newsml:reuters.com:*:nFWN24C0T6
    "It's highly indicative of what is happening on trade over
the last couple of months," said Stefan Koopman, senior market
economist at Rabobank in Utrecht, Netherlands.
    "We've seen carmakers have difficulty, with Chinese car
sales dropping over the past 6 to 12 months."
    Chemicals  .SX4P  made the biggest gains with Swiss
specialist EMS-Chemie  EMSN.S  closing 5% higher on good
first-half results. However, it warned that the trade conflict
between major powers caused considerable uncertainty among
consumers and companies. 
    The warning came days after German chemical giant BASF
 .BASFn.DE  highlighted the repercussions of the protracted
trade war between the United States and China, especially the
toll it was likely to take on the agricultural and auto sectors.
    In contrast to world stocks, European shares had a tepid
week, although they have regained their footing after a huge
sell-off in May due to an escalation in U.S.-China trade
tensions and expectations of rate cuts by major central banks. 
    Volumes on the STOXX 600 index were well-below long-term
averages on Friday as investors braced for next week's earnings
deluge.
    Europe's most valuable technology company, SAP  SAPG.DE ,
semiconductor company ASML  ASML.AS  and Novartis are among
those due to report second-quarter results next week.
    Companies listed on the pan-European STOXX 600 index are
expected to report 0.8% earnings growth in the second quarter,
down sharply from an estimate of 1.8% a week ago, according to
data from I/B/E/S Refinitiv on Tuesday.  urn:newsml:reuters.com:*:nL8N24A4QS
    

 (Reporting by Agamoni Ghosh and Susan Mathew in Bengaluru;
Editing by Arun Koyyur and Kirsten Donovan)
 ((Agamoni.Ghosh@thomsonreuters.com; +918067491130; Reuters
Messaging: Agamoni.Ghosh.thomsonreuters.com@reuters.net))

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