Strong US jobs figures fail to lift spirits

A strong US payrolls report failed to lift European spirits after a downbeat week marked by renewed turmoil in Chinese markets. With oil on the slide again, European stocks finished 7 per cent lower on the week. The FTSE 100 in London has fallen more than 5 per cent since Monday and the German Dax was down 8 per cent.

DUBLIN

The mood was hardly brighter in the Irish market, down 3.16 per cent since the start of the year.

“A bit of Asian contagion is coming through again . . . This market is feeling very bruised at the end of the week, ” said one Dublin trader. “Normally, hope springs eternal in the first week of the year, but it’s the worst opening week in the States since the 1920s.”

The Iseq index posted a tiny gain on the day , rising 0.04 per cent to finish at 6,566.45. Although investors took note of some “blue sky” in early business, the trader said they rolled over quickly in line with international sentiment.

News flow was light this week, although Smurfit Kappa made two acquisitions for €186 million in Brazil and Ryanair delivered positive year-end passenger data for 2015. Smurfit Kappa gave up 0.29 per cent on the day to finish at €22.60½. Ryanair closed up 1.52 per cent at €14.96½.

Shares in Permanent TSB, which is to a make a 2 per cent cashback offer to new mortgage customers, lost 2.9 per cent to close at €4.38.

LONDON

Top British shares took their biggest tumble in the first week of a year since 2000, as China’s decision to let the yuan weaken rattled global markets.

The FTSE 100 index was down 5.3 per cent on the week, its biggest weekly slump since August, when China similarly roiled stock markets by allowing its currency to weaken.

The FTSE had opened higher after Chinese stocks regained some poise following a plunge the previous day. However, traders said the unpredictability of the previous week prompted investors to sell out of their positions before the weekend for fear of being caught in volatility on Monday.

“We saw a bit of buying early doors, but that seems to have petered out, as no one wants to go into the weekend holding long positions, given how volatile crude oil and other commodities are at the moment,” said Manoj Ladwa, head of trading at TJM partners.

Oil shares came under pressure as Brent gave up early gains to trade near its lowest level for more than 11 years. Royal Dutch Shell fell 5.5 per cent, while BP retreated 2.7 per cent.

EUROPE

European shares fell, with lingering worries about China causing a major regional equity index to suffer its worst weekly loss since August 2011. The pan-European FTSEurofirst 300 index ended down 1.5 per cent on the day and 7 per cent on the week.

That marked its worst weekly performance since August 2011, when it fell nearly 10 per cent during the euro zone’s sovereign debt crisis.

NEW YORK

US stocks bounced in and out of positive territory in choppy trading as investors contemplated the impact of fluctuating oil prices and robust US job growth data.

Oil prices slipped below $33 per barrel, their lowest in more than a decade. They have lost about 70 per cent since mid-2014.

Data showed that non-farm payrolls surged in December and the unemployment rate held steady at 5 per cent. October and November payrolls were revised sharply higher.

At lunchtime in New York, the Dow Jones industrial average was up 7.5 points, or 0.05 per cent, at 16,521.6. The Standard and Poor 500 was down 0.12 points, or 0.01 per cent, at 1,942.97 and the Nasdaq composite index was up 6.38 points, or 0.14 per cent, at 4,695.80.

The jobs report was the first since the US Federal Reserve raised interest rates last month for the first time in nearly a decade. – (Additional reporting: agencies)