Stocks fall on concerns over Ukraine
Disappointing corporate results affect US and European markets
Worries over escalating tension in Ukraine and weak results held back stocks in Europe. Photograph: Sergei Ilnitsky/EPA
Global equity markets declined and government debt rose amid rising tension in Ukraine as Russia declared the country on the brink of civil war and as disappointing corporate results dogged US and European stock markets.
Worries over escalating tension in Ukraine and weak results held back stocks in Europe. Wall Street fell as Nasdaq slumped on another round of selling in technology and biotech names.
Providence Resources was the stand-out stock in a what was described as a “topsy turvy day” which saw the market close towards the end of its range and a few shares coming under selling pressure. Providence shares were up 10 per cent after it confirmed that it had entered discussions with a number of parties over the Barryroe oil field. It closed at €2.46, up 11,82 per cent.
Bank of Ireland continued its weak run, closing down 2.6 per cent at 27 cent with the fall attributed to comments at the weekend that the Government might look to sell down its shareholding. Smurfit Kappa was also down on the back of weaker prices for recycled container board in Europe ending the day at €16.43, a fall of 3.6 per cent.
Britain’s top share index edged lower, led by security group G4S after an analyst’s downgrade, while concern about corporate earnings took its toll on investor sentiment. G4S fell 2.8 per cent in brisk trade. Traders blamed Deutsche Bank’s lowering its rating to “sell” from “hold”.
Rio Tinto fell 3.1 per cent to 3,302.5 pence. The world’s second-largest mining company said first-quarter iron ore production rose to 52.3 million metric tons.
SABMiller declined 2.3 per cent to 3,052.5 pence. The world’s second-biggest brewer reported revenue that rose 3 per cent in the year through March and 2 per cent in the fourth quarter, missing the median estimate of analysts for a 4 per cent increase in both periods.
German stocks fell over concerns about Ukraine , and a report showed a bigger-than-expected monthly decline in investor confidence in Europe’s largest economy. The DAX Index dropped 1.8 per cent to 9,173.71 at the close in Frankfurt, extending its decline in the final 90 minutes of trading. The benchmark has retreated 5.8 per cent from its record on Jan. 17 . The broader HDAX Index fell 1.7 per cent today.
Air Berlin dropped 4.7 per cent to €1.65. Etihad’s attempt to restructure its 29 per cent stake in the low-cost German airline may jeopardise Air Berlin’s takeoff and landing rights in Europe, Frankfurter Allgemeine Zeitung reported without citing anyone. The airline, which is owned by the government of the United Arab Emirates, plans to use its minority holdings to help funnel traffic through Abu Dhabi. Siemens slipped 1.5 per cent to €94.89. EU and US sanctions against Russia will affect western companies such as Siemens that have rail projects in the country, Russian Railways chief Vladimir Yakunin said in an interview with Handelsblatt.
L’Oreal advanced 1.5 percent to €122.50 while France’s CAC 40 declined 0.9 per cent. Sodexo climbed 3.7 percent to €77.68. Deutsche Bank AG raised its recommendation on the catering company to buy from hold.
US stocks fell as early gains evaporated when momentum shares once again lost ground, overshadowing a jump in Coca-Cola and Johnson & Johnson after their quarterly earnings. The Nasdaq slid more than 1 per cent, weighed down by another downturn in momentum names.
In recent weeks, momentum names – stocks seen by investors as having high growth potential – have been under pressure after a meteoric rise in their prices took valuations to levels that appeared to be unsustainable. Tesla Motors Inc fell 5.5 per cent to $187.25 and NetFlix Inc dropped 4.5 per cent to $316.82 to rank among the worst performers in the Nasdaq 100 index.