Greek debt woes weigh on markets
MOST EUROPEAN stocks dropped, with the Stoxx Europe 600 Index trimming a six-month high, and the euro declined the most in three weeks as Greece struggled to reach a deal with its international creditors.
THE DUBLIN market started this week quieter than last, in line with the macro-economic uncertainty. The Iseq finished up at 3,139. Traders noted that the pull back was unsurprising in light of the surge in stock values since the beginning of the year.
Despite relatively low volumes, there was some stock specific news. DCC was a strong performer after the company announced the completion of its acquisition of Swedish fuel distributor Swea Energi. The current cold snap in the UK, which is expected to last some weeks, is also helping the stock, which has a significant fuel business in the UK. DCC closed up 1.3 per cent to €19.35.
Smurfit Kappa, which reports results later this month, continued its strong performance of late, adding 4 per cent to €6.60.
Aer Lingus was steady at €0.89, after reporting a rise in passenger numbers in January, though 2011 numbers had been skewed as a result of flight cancellations due to bad weather and a cabin crew dispute.
Ryanair which has enjoyed a strong run of late following results last week fell 1.5 per cent to €4.29.
Readymix also saw some movement, adding 16 per cent to €0.22, after Cemex increased its bid for the percentage of the company it does not own to 25 cent a share.
The FTSE 100 slipped 0.2 per cent yesterday, snapping a four-day rally, on the back of concerns about the Greek debt crisis.
Almost half of British exports go to the 17 euro nations and UK banks are exposed to more than $1 trillion of borrowings in the region.
Nonetheless, stocks in London have rallied 19 per cent from last year’s lowest level.
Glencore International, the world’s biggest listed commodities trader, dropped 4.5 per cent after the Financial Timesreported the company may pay a premium to acquire Xstrata.
Xstrata dropped 2.1 per cent to 1,255.5 pence.
Admiral Group, the car insurer that owns the website confused.com, fell 3.7 per cent, the most since December 14th to 999.5p.
A gauge of mining shares fell 1.4 per cent as copper retreated on the London Metal Exchange.
Rio Tinto retreated 1.3 per cent to 3,935.5p. “A combination of index heavyweights from the mining and financial sectors are pulling the markets a little lower,” said David Jones, the chief market strategist at IG Index Ltd, “So far this is just being seen as a slight pull-back from the sharp gains on Friday afternoon.”
French Connection dropped 14 per cent to 50p after it said Christmas sales were disappointing and that its full-year pretax profit will be lower than analysts’ estimates. RM, a UK provider of educational products, fell 9.6 per cent to 73p.
EUROPEAN STOCKS dropped, with the Stoxx Europe 600 Index trimming a six-month high, as Greece struggled to reach a deal with its international creditors.
The benchmark Stoxx 600 fell 0.2 per cent to 264.11 at close of business in London, paring an earlier drop of as much as 0.8 per cent. More than three stocks retreated for every two that advanced.
National benchmark indexes declined in 16 of the 18 western-European markets. The UK’s FTSE 100 slipped 0.2 per cent. France’s CAC 40 Index declined 0.7 per cent, while Germany’s DAX added less than 0.1 per cent.
Vedanta Resources slipped 3.2 per cent as the shares of metal producers declined. Glencore International slid after a report showed that the commodities trader may offer 2.8 shares for each Xstrata share.
Société Générale, France’s second-biggest lender, and Credit Agricole decreased more than 2.5 per cent.
US STOCKS dipped yesterday after a five-week rally, as the delay by debt-ridden Greece in accepting the terms of a bailout gave investors little reason to buy equities.
The Dow Jones industrial average fell 41.85 points, or 0.33 per cent, at 12,820.38 at lunchtime on the East Coast. The Standard Poor’s 500 Index slid 3.04 points, or 0.23 per cent, at 1,341.86.
The Nasdaq Composite Index dropped 7.48 points, or 0.26 per cent, at 2,898.18.
Hasbro rose 2.5 per cent to $36.77 after the toymaker reported a fourth-quarter profit just above analysts’ lowered expectations.
Humana posted a big rise in fourth-quarter profit, but revenues came in below expectations. Its shares fell 5 per cent to $85.70.
Micron Technology slumped 2.6 per cent as it named Mark Durcan as its chief executive officer. – (Additional Reporting: Bloomberg)