European stocks fell from a one- month high as investors weighed valuations and as pro-Russian rebels widened their attack on Ukraine’s forces.

Ocado Group Plc slumped the most in two years after Redburn (Europe) Ltd. advised investors to sell shares in the online grocer. Telecom Italia SpA gained 1.3 percent after Vivendi SA picked Telefonica SA to discuss a sale of its GVT unit. Essilor International SA advanced 4.3 percent after posting an 11 percent increase in first-half adjusted profit. Eiffage SA rose 3.5 percent after Kepler Cheuvreux upgraded the shares.

The Stoxx Europe 600 Index slid 0.7 percent to 341.05 at the close also as data showed that German unemployment unexpectedly rose in August. The benchmark gauge had climbed 2 percent in the three days through Wednesday after European Central Bank President Mario Draghi signaled policy makers are ready to add stimulus.

“The index has had a pretty nice rise over the past few weeks and investors may be taking some money off the table in case the U.S. data doesn’t meet expectations,” Ben Kumar, who helps manage $10 billion at Seven Investment Management LLP in London, said. “Perhaps investors also feel that the recent poor economic news in the euro zone, such as the rise in German unemployment, isn’t quite bad enough to prompt action from the ECB, but isn’t good enough to support a continued rally.”

The Stoxx 600 added 0.1 percent Wednesday to reach the highest level since July 24. The gauge trades at 15.4 times the projected earnings of its members, higher than the five-year average of 12.6 times, according to data compiled by Bloomberg.

American Economy

Data showed 298,000 Americans made first-time jobless claims in the week ended Aug. 23, a drop of 1,000 from the revised figure for the previous week. Another release showed pending sales of previously owned houses rose a faster-than- projected 3.3 percent in July, after a 1.3 percent drop the prior month.

A final report today confirmed that an index of euro-area household sentiment decreased to minus 10 in August. Separate figures showed the number of Germans out of work climbed a seasonally adjusted 2,000 this month.

Ukrainian President Petro Poroshenko called an emergency security meeting to defend against what he called a Russian “invasion” of his country, after pro-Russian separatists gained ground in intensified fighting in eastern regions.

The U.S. State Department cited reports of fresh fighting and said the indications are that the incursion is being directed by Russia. Moscow denied it.

Volatility Surge

The VStoxx Index, which measures options traders’ expectations of volatility in euro-area stocks, jumped 7.3 percent.

National benchmark indexes fell in 16 of the 18 western European markets. The U.K.’s FTSE 100 lost 0.4 percent and France’s CAC 40 slid 0.7 percent. Germany’s DAX dropped 1.1 percent.

Ocado slumped 16 percent to 339.3 pence after Redburn downgraded the shares to sell from buy, citing slowing sales. The brokerage almost halved its estimate for the stock’s fair value to 257 pence from 500 pence.

Hamon & Cie. tumbled 17 percent to 11.70 euros, its largest retreat since 2004. The cooling-systems engineer said it will raise at least 20 million euros in a share sale after an accounting error at its French subsidiary Hamon D’Hondt erased 40.9 million euros of equity.

Wendel, Veritas

Wendel SA lost 6.8 percent to 95.53 euros, its biggest drop since March 2012, after saying that first-half net income fell 78 percent. The French investment firm holds a majority stake in Bureau Veritas SA, the world’s second-largest provider of testing, inspection and certification services, which yesterday cut its profit target. Bureau Veritas slid 7.3 percent, the most since 2009, to 18.45 euros today.

Telecom Italia gained 1.3 percent to 87.4 euro cents. Vivendi picked Telefonica over the Italian company to start exclusive talks on a sale of its Brazilian broadband unit. Vivendi said it considers Telefonica’s raised offer attractive because it would generate a capital gain of more than 3 billion euros. Telecom Italia had made a bid in the morning and Telefonica had responded with a higher offer within minutes.

Essilor rose 4.3 percent to 79.48 euros after posting first-half adjusted operating profit of 494 million euros and saying it expects medium-term growth. For the full year, the company projected more than a 13 percent increase in revenue, excluding the impact of currency movements.

Eiffage gained 3.5 percent to 48.89 euros. Kepler Cheuvreux upgraded the shares to hold from reduce, citing price declines in the past three months and steps taken by the company to boost profitability. Eiffage lost 11 percent in the three months to July.