Euro falls for fifth day as speculation grows over ECB interest rate cut
Dollar rises as US manufacturing expands at fastest pace in 2 ½ years
Renault fell 4.4 per cent to €61.67 after its Japanese partner Nissan cut its full-year profit forecast by 15 per cent. Photograph: Srdjan Zivulovic/Reuters
The euro fell for a fifth day against the dollar as signs of economic weakness in the single-currency bloc fuelled speculation that the European Central Bank will cut interest rates as soon as its meeting next week. The dollar rose as US manufacturing expanded at its fastest pace in 2 ½ years and improving economic data led to increased likelihood that the Fed will taper its stimulus programme.
The Iseq closed down 0.3 per cent, in line with most European markets.
Bank of Ireland shares fell 5.19 per cent to €0.256, reversing strong gains on Thursday following the European regulatory ruling allowing the lender to continue counting €1.8 billion of State-owned preference shares as core Tier 1 capital if sold to private investors.
Ryanair was volatile ahead of its quarter two results expected on Monday, falling as low as €5.92 before stabilising to close at €6.10, the same as Thursday.
Cement-maker CRH fell 0.92 per cent to €17.735, broadly in line with its European peers, while drinks group C&C held on to gains from earlier in the week following strong results on Wednesday, falling 0.39 per cent to close at €4.30.
Aer Lingus rose 2.36 per cent to €1.433 with strong trading volumes relative to low levels over the past week.
Royal Bank of Scotland was the top FTSEurofirst 300 faller after posting a surprise loss, missing profit forecasts by £1 billion. The part-nationalised bank closed 8 per cent lower, down 27.6p to 340p, as the bank returned to losses in the third quarter and warned that higher bad debt writedowns of up to £4.5 billion in the final three months of the year will lead to a significant full-year loss.
The wider FTSE 100 Index held firm, up 3.3 points to 6734.7, thanks to big share gains from mobile phone giant Vodafone due to reported bid interest from AT&T. Vodafone shares jumped 8p to 232.5p, a rise of 4 per cent.
Meggitt Plc tumbled 10 per cent to 513.5 pence, its largest decline since April 2009. The world’s biggest provider of wheels and brakes for military aircraft cut its full-year sales forecast, citing short-term production problems at a unit. Meggitt predicted sales growth in low single digits, compared with a previous forecast for a mid-single-digit increase.
European stock markets eased off five year highs, after fresh signs of corporate earnings weakness pegged back car maker Renault. The company fell 4.4 per cent to €61.67 after its Japanese partner Nissan cut its full-year profit forecast by 15 per cent.