Ukraine and Middle East conflicts shape performance in global markets

Indicator on German investor sentiment reports drops to lowest level since 2012

A trader watches his screen on the floor of the New York Stock Exchange yesterday. US stocks fluctuated, after the Standard and Poor’s 500 Index produced its biggest two-day gain since April, as investors watched geopolitical developments and energy shares sank. Photograph: Reuters

A trader watches his screen on the floor of the New York Stock Exchange yesterday. US stocks fluctuated, after the Standard and Poor’s 500 Index produced its biggest two-day gain since April, as investors watched geopolitical developments and energy shares sank. Photograph: Reuters

Wed, Aug 13, 2014, 01:00

Both European and US stocks fell with the euro amid concern over conflicts in Ukraine and the Middle East.

German investor confidence, reported by the ZEW Center, dropped to the lowest level since 2012 as the crisis in Ukraine and a sluggish euro- area recovery dampened the outlook for Europe’s largest economy.

There was particular focus on an aid convoy departing Russia for Ukraine amid western warnings to Moscow not to use it as a cover for invasion. DUBLIN Ireland’s Iseq Index gained 0.2 per cent yesterday, outperforming most other markets.

The big news has been with Fyffes, following revelations on Monday that its proposed merger with Chiquita was under threat after the US firm received a cash offer from the Cutrale Group and Safra Group. Yesterday stock was trading at about €0.92, the same level as they fell to immediately following the announcement.

It was a better day for Ryanair particularly as the airline industry has found itself under pressure in recent weeks. The budget carrier closed up 1.15 per cent at €6.83. CRH was also a big mover, closing up almost 1 per cent at €17.21, outperforming the sector generally and the main reason for the index closing strongly. Green Reit closed up 4.1 per cent to finish at €1.26. LONDON UK stocks were little changed, after rallying the most in almost three weeks on Monday. The 100 Index dropped 0.4 points, or less than 0.1 per cent, to 6,632.42 at the close in London.

Shell, Europe’s largest oil company, slipped 1 per cent to 2,376 pence. The price of a barrel of Brent crude dropped 1.4 per cent as the International Energy Agency said a glut of supply would protect the oil market from upheaval in Iraq.

Prudential advanced 2.2 per cent to 1,368.5 pence after saying that operating profit climbed to £1.52 billion in the first half from £1.42 billion a year earlier. It was the second biggest riser in the top flight after its strong set of results following strong demand in Asia and a resilient performance in the UK. EUROPE Stocks fell, following their biggest rally across Europe since April. The Stoxx 600 Index slipped 0.2 per cent to 328.74 at the close of trading.

National benchmark indexes retreated in 11 of 18 western European markets. France’s CAC 40 slid 0.9 per cent, and Germany’s DAX dropped 1.2 per cent.

Henkel dropped 5.3 per cent to €78.16. The German maker of Loctite glue and Persil washing detergent said earnings growth will slow in the second half as the conflicts in Ukraine and the Middle East harm business.

National Bank of Greece advanced 4 per cent to €2.35, and Piraeus Bank climbed 3.9 per cent to €1.35. In Italy, Banca Popolare di Sondrio Scarl rose 3.3 per cent to €3.24 and Banca Monte dei Paschi di Siena added 4.8 per cent to €1.08. Commerzbank, Germany’s second-biggest lender, climbed 1.7 per cent to €10.62.

The euro fell after investor confidence in Germany slumped to the lowest level since 2012, adding to concern Europe may be entering a Japanese-style deflationary spiral. NEW YORK US stocks fluctuated, after the Standard and Poor’s 500 Index produced its biggest two-day gain since April, as investors watched geopolitical developments and energy shares sank.

By lunchtime, the Standard and Poor’s 500 Index declined 0.2 per cent in New York, after the biggest two-day gain since April, rising by 1.4 per cent.

Chevron slipped 0.8 per cent for the biggest slide in the Dow, while Exxon Mobil dropped 0.5 per cent.

Kinder Morgan lost 2.2 per cent after yesterday rallying 9 per cent, and Pioneer Natural Resources slid 2.4 per cent.

Nuance Communications dropped 11 per cent to $16.15 after the maker of speech-recognition software missed the average analyst projection of $498.5 million. – (Additional reporting: Bloomberg, PA)