EUROPEAN SHARES notched up their longest losing streak in four months yesterday. Mining stocks led the fallers after weak data from China and the euro zone.
Investor appetite for riskier assets fell after weak purchasing managers indexes (PMIs) in both China and the euro zone raised concerns about the growth outlook and suggested Europe could fall into recession.
In the US initial jobless claims fell to 348,000 in the week ended March 17, the fewest since February 2008.
DUBLIN
It was a quiet day of thin trading yesterday as the Iseq index closed down by 1.1 per cent at 3263.
CSO figures showing that Ireland technically returned to recession in the final three months of last year could have contributed to the lacklustre mood.
Results from Independent & News Media were broadly in line with expectations. However its stock closed down 2 per cent at 0.24 cent. News of a possible leadership tussle at the forthcoming AGM in June may have weighed on stock prices and worried investors.
Mining stock Kenmare performed weaker than any other stock in the sector. Experiencing one of its weakest days in months, closing down 4.43 per cent at 0.54 cent, analysts attributed the performance to the company’s exposure to weaker industrial demand in China.
Dragon Oil closed up 0.68 per cent at €7.45 on analyst suggestions that major Chinese oil companies were considering it as an acquisition target.
Potentially impacted by the poor GDP figures, Bank of Ireland shares closed down 7.35 per cent at 0.12 cent.
Despite news that it lost its latest round in its legal battle to avoid paying for hotels, meals and drinks for passengers disrupted by delayed flights during the Icelandic volcano eruption in 2010, Ryanair closed up 0.23 per cent at €4.28.
LONDON
The FTSE 100 Index was 46.3 points lower at 5845.7, a fall of nearly 1 per cent, after purchasing managers’ surveys in both China and the euro zone came in below expectations.
The FTSE’s heavily weighted mining stocks were battered by the renewed fears over a global recession, with Fresnillo slipping 116p to 1621p, Vedanta Resources dropping 65p to 1287p and commodities trader Glencore losing 12.3p at 403.5p.
Randgold Resources was the biggest faller in London’s top flight as details emerged of a coup in Mali, where the gold miner has two big facilities. The stock was off 830p at 5765p.
There was a mixed session for retailers after the Office for National Statistics revealed a larger-than-expected 0.8 per cent decline in sales volumes in February and downwardly revised growth for January.
Next saw shares slide 1p lower at 2914p. Elsewhere, Marks & Spencer dropped 2 per cent or 6.5p to 383p.
But B&Q owner Kingfisher, which revealed a 20 per cent rise in full-year profits and highlighted the progress of its four-year turnaround programme, climbed to near the top of the risers’ board. Shares were 7.4p higher at 307.4p.
EUROPE
European stocks fell for a fourth day, the longest losing streak since November, as manufacturing contracted in China and the euro area. France’s CAC 40 retreated 1.6 per cent and Germany’s DAX declined 1.3 per cent.
Baloise Holding, Switzerland’s third-largest insurer, and Meyer Burger Technology, a maker of solar-panel equipment, slid more than 4 per cent in Zurich trading after profit declined.
The Stoxx Europe 600 Index retreated 1.2 per cent to 265.49 at the close of trading. The gauge has still gained 8.6 per cent this year as the European Central Bank disbursed €1 trillion to the region’s lenders and US economic data surpassed estimates.
“People have been too optimistic regarding global economic recovery,” said Stephane Ekolo, chief European strategist at Market Securities in London. “We will hear more and more people saying China is heading for a hard landing and that the euro zone isn’t finished with its problems.”
Hermes International rose 2.3 per cent to €249.80 after the French maker of Kelly bags and silk scarves posted earnings that exceeded analyst projections and offered a bonus dividend to shareholders.
US
In US trading, commodity and industrial companies retreated as reports showed manufacturing contracted in Europe and China.
Caterpillar, the biggest maker of construction and mining equipment, fell the most in the Dow Jones Industrial Average, sinking 2.7 per cent to $106.06.
FedEx, the world’s largest cargo airline, fell 4.1 per cent to $91.85. – (Additional Reporting: Bloomberg)
