European stocks slid yesterday as fears grew that the US will not resolve its budget deadlock ahead of the new year.

US House speaker John Boehner scrapped a plan to allow higher tax rates on annual incomes above $1 million, giving in to resistance from party colleagues.

The move stalled talks between Republican Boehner and President Barack Obama with just 10 days to go before the year-end deadline for a compromise.

The Congressional Budget Office says the US will probably tumble back into a recession should lawmakers fail to reach an accord on the budget.

DUBLIN

In Dublin, insulation and building materials specialist Kingspan was one of the better performers, adding 2.71 per cent to close at €8.217.

Smurfit Kappa maintained this year’s good performance, adding 1.04 per cent to close at €9.094.

Index heavyweight CRH inched ahead, adding 0.95 cent to close at €15.38.

LONDON

Spectris fell 1.5 per cent to 2,019 pence, for the largest drop in more than a month.

The UK’s biggest maker of production-testing gear was downgraded to hold from buy at Investec

Bookmaker William Hill, with more than 2,000 outlets, slid 2.4 per cent to 347.8 pence.

Eurasian Natural Resources, a producer of ferro alloys and iron ore in Kazakhstan, slid 1.4 per cent to 276.9 pence. The stock was cut to neutral from buy at Goldman Sachs Group. A measure of the shares of commodity companies declined for a third day.

Dairy Crest slid 3.9 per cent to 378.2 pence as Goldman cut its forecast price on the shares of the UK’s biggest milk and cheese producer to 330 pence from 364 pence.

The brokerage reiterated a sell recommendation on the stock.

United Utilities added 1.2 per cent to 682 pence and Severn Trent, the UK’s second-largest water company, added 2.6 per cent to 1,610 pence.

EUROPE

Aeroports de Paris slumped 5.4 per cent to €58.62, the biggest decline since August 2011, after cutting projections for earnings before interest, taxes, depreciation and amortisation and for traffic growth.It now expects earnings growth of 25 to 35 per cent between 2009 and 2015, compared with its previous forecast of 40 per cent.

The operator of Charles de Gaulle and Orly airports also expects an annual traffic-growth rate ranging from 1.9 per cent to 2.9 per cent between 2010 and 2015, lower than a previous estimate of 3.2 per cent.

ArcelorMittal dropped 2.5 per cent to €12.88. The world’s biggest steelmaker will write down the goodwill in its European businesses by about $4.3 billion as the region’s weakening economy erodes demand.

Alcatel-Lucent lost 3.8 per cent to €1.02. Standard Poor’s may cut the French network equipment vendor’s long-term rating. “Ongoing cash losses and rising interest costs could offset the positive impact” of its recent refinancing on liquidity, said the ratings company.

Alcatel’s shares rallied 24 per cent since their December 13th close through to Thursday after the company reached a €1.6 billion- financing deal.

Skanska dropped 1.9 per cent to 108.40 kroner. SBM Offshore, the largest maker of floating oil and gas platforms, dropped 4.2 per cent to €10.52.

NEW YORK

Bank of America, the second-largest US bank by assets, declined 2.5 per cent to $11.24. Citigroup dropped 2.2 per cent to $39.28, while JPMorgan Chase lost 1.4 per cent to $43.90.

Micron Technology fell 8 per cent to $6.25 for the biggest retreat in the SP 500. The largest US maker of memory chips reported a wider fiscal first-quarter loss as a slump in demand for personal computers led to a supply glut, weighing down prices.

Nike rallied 5 per cent to $103.91. – Additional reporting: Bloomberg