European shares ended nearly two per cent lower yesterday after a volatile session, hit by a late drop in Syngenta after Monsanto dropped its offer for the company.
Stocks remain highly sensitive to fears over Chinese growth that have wreaked havoc in markets for days, but benchmark indexes closed above session lows on an early Wall Street rally and hopes of monetary stimulus from the European Central Bank.
In Ireland, the Iseq Overall Index closed down 0.3 per cent at 6,115.53.
DUBLIN It was all about Irish bookmaker Paddy Power, which rose by 19.5 per cent to €93 a share on foot of its announcement of a merger with UK betting exchange Betfair. Paddy Power's shareholders are also in line to share in an €80 million special dividend. News of the merger with Betfair overshadowed the publication of strong interim results.
The main loser on the main market was Smurfit Kappa, which closed down 2.8 per cent at €24.58.
LONDON The UK’s top share index sank yesterday, not far from its lowest closing levels since the end of 2012, as fears about Chinese growth gnawed and a commodities sell-off rattled markets across Europe.
Data showing an unexpected pick-up in UK retail sales and an increase in mortgage approvals offered encouraging signals on the domestic economy, but failed to stem selling.
The FTSE 100 index closed down 1.7 per cent to 5,979.20 points, broadly in line with falls in European equities.
The index posted its biggest one-day rise since 2011 on Tuesday after China cut interest rates to calm markets. But investors quickly resumed their focus on the deteriorating outlook for China’s economy and its impact on others.
London-listed miners Fresnillo and Randgold fell between 4.6 and 7 per cent after gold and copper prices fell. Glencore dropped 3.7 percent.
Shares in advertising group WPP fell 2 per cent after the group said trading in China had been "weak" in the second quarter compared with the first. The group reiterated it was on track to hit its full-year sales target, however.
On the upside, shares in mid-cap Betfair soared 20 per cent on the Paddy Power news.
EUROPE Syngenta fell 18.2 per cent after US agribusiness leader Monsanto gave up trying to buy the group. The Swiss company was the top faller on the FTSEurofirst 300 index and in the STOXX 600 chemicals sector, which fell 3.4 per cent.
Basic resources stocks closed down 2.6 per cent as copper fell nearly 3 per cent.
The pan-European FTSEurofirst 300 index was down 1.9 per cent at 1,380.88 by the close, having fallen as much as 2.8 percent, buoyed somewhat by a strong start to trading on Wall Street.
Stocks were also supported after an ECB official said commodity price falls put the bank’s inflation target at risk, and that it was ready to act if needed.
Germany’s DAX weakened by 1.3 per cent, leaving it some 20 per cent below a record high hit in April.
NEW YORK US stocks advanced as investors made another go at finding a floor to the steepest losing streak in four years after Tuesday’s early rally evaporated.
Technology companies led the gains, with Apple, Google and Intel rising at least 2.6 per cent.
Banks were also on a path similar to that of Tuesday with JPMorgan Chase and Citigroup increasing more than 2.1 per cent.
Cameron International Corp soared 40 per cent after agreeing to be bought by Schlumberger in a $14.8 billion deal. – (Additional reporting by Reuters and Bloomberg)
