European stocks retreated from a three-week high yesterday as commodity producers declined and a number of companies cut payouts to shareholders.
Following on from a day of gains in most markets, trading closed with declines in Germany’s Dax and France’s Cac 40, although the FTSE 100 managed to climb by 0.3 per cent.
Swiss stocks advanced to their highest level since May 2008 as shares of construction-related companies rose.
The euro fell against the US dollar, while the Australian, Canadian and New Zealand currencies were all weighed down by weakness in global stocks and commodities.
DUBLIN
A busy day for the Irish market saw it slightly outperform its European counterparts with the notable exception of the FTSE.
Paddy Power returned to relative normality following its record trading on Tuesday, closing down 1.8 per cent at €65.04.
Smurfit enjoyed a good day, closing at €11.63, up 0.3 per cent. Shares in Dragon Oil were busy too, finishing reasonably well at €6.84, a slight loss of 0.4 per cent.
C&C saw healthy trading finishing at €4.89 while Ryanair, which had climbed steadily on the previous day’s trading, remained virtually flat, closing at €5.78, a gain of 0.02 per cent.
Kingspan dropped 2.3 per cent to €8.79 at the close, while Bank of Ireland gained slightly to €0.13, an increase of 1.47 per cent.
LONDON
The FTSE 100 index closed up 0.3 per cent, or 16.30 points higher, at 6,395.37 points – its highest level since early 2008.
It fell towards the end of the trading session, however, down from an intraday high of 6,412.44 points.
Traders said the fact the index could not hold above the 6,400 point level, seen by many as key to more near-term gains, meant it was now more likely that the market would fall in the coming sessions.
Insurer RSA was one of the biggest drags, slumping 14.2 per cent after it cut its dividend. Rival Aviva fell in its wake, dropping 4.1 per cent.
Drinks-can maker Rexam jumped 5.3 per cent to top the FTSE 100 after posting higher profits.
EUROPE
European stocks retreated with companies from Lufthansa to RSA Insurance cutting their payouts to shareholders.
BHP Billiton contributed the most to the Stoxx Europe 600 Index’s slide while Lufthansa posted its biggest drop in 15 months after saying it will suspend its dividend for the first time since 2010 to preserve cash.
Royal KPN plunged 9.7 per cent to €2.92, an 11-year low for the Dutch telecoms group after America Movil SAB agreed not to increase its stake beyond 30 per cent.
Maurel and Prom slid 5.4 per cent to €14.14 after the French oil explorer said it has not received an expression of interest valuing its shares at €19 apiece.
The world’s biggest cement maker, Lafarge jumped 5.5 per cent to €49.27, saying its fourth-quarter earnings before interest, taxes, depreciation and amortisation rose to €856 million, beating the average analyst estimate of €821.6 million.
NEW YORK
Stocks dipped with energy shares falling as investors found few reasons to buy following a rally that has held major indexes near five-year highs for three weeks.
At lunchtime, investors were waiting for the minutes from the Federal Open Market Committee’s January meeting for clues to the interest rate outlook. Meanwhile, traders were flagging unconfirmed rumours in the market that a troubled hedge fund was selling assets.
Energy companies were among the weakest yesterday, hurt by disappointing corporate results and a 2.4 per cent drop in crude oil prices.
Newfield Exploration fell 5.8 per cent to $25.73 while Devon Energy fell 1.6 per cent to $59.60. Both posted fourth-quarter losses. (Additional reporting: Reuters, Bloomberg)
