Gloomy news from China and US weighs on markets
Anxiety mounts that US Federal Reserve will soon pare back stimulus measures
The US Federal Reserve building in Washington. Minutes released from the Fed’s October meeting showed it expects further improvement in the US jobs market and “would thus warrant trimming the pace of purchases [of bonds] in coming months”.
The Iseq remained broadly flat as shares slid elsewhere across Europe, following gloomy news from China and the US. A gauge of manufacturing in China dropped more than forecast, while anxiety mounted among traders that the US Federal Reserve will soon pare back stimulus measures.
Minutes released yesterday from the Fed’s October meeting showed it expects further improvement in the US jobs market and “would thus warrant trimming the pace of purchases [of bonds] in coming months”.
National benchmark indexes retreated in nine of the 18 western European markets. The UK’s FTSE 100 and Germany’s DAX were little changed, while France’s CAC 40 dropped 0.3 per cent.
Independent News & Media continued its recent good run, gaining 5.26 per cent to close at 14c. The company has announced a 7cent a share price for its upcoming share issue, which is designed to raise €40 million. Dermot Desmond is set to double his stake to become the second largest shareholder in the company, while the staff pension scheme will also be allocated shares.
C&C, the Clonmel-based maker of the Bulmers-Magners cider brand, dropped by 0.66 per cent on good trading volumes. Its rival, SAB Miller, yesterday reported a modest contraction in Europen operations.
Aer Lingus climbed 1.28 per cent to close at €1.35. This followed the news that staff at Shannon had accepted proposals to reduce cabin crew on new transatlantic flights.
British American Tobacco declined 2.4 per cent to £3.28, and Imperial Tobacco Group lost 2.6 per cent after Philip Morris International, the world’s largest publicly traded tobacco company, said international cigarette volumes may drop as much as 3 per cent next year.
Daily Mail and General Trust, the publisher of the Daily Mail newspaper, climbed 2.6 per cent to £8.62. The company said contribution from national newspapers to group revenues dropped to 36 per cent this year from 43 percent in 2012. It forecast full-year revenue of £1.8 billion.
Intermediate Capital, a London-based money manager, fell 3.4 per cent to £4.45 after it was downgraded by Numis, which said that half-year results were weaker than expected. It reported a rise in first-half pretax profit to £155.3 million from £39.6 million.
Atos dropped 4.1 per cent to €61.70 after it emerged shareholder PAI Partners is selling 8.9 million shares in the French computer services supplier for €61.25 each. Earlier, Atos said it is studying potential acquisitions to help make its Worldline unit Europe’s biggest payments company.
Actelion gained 1.8 per cent to 75.55 Swiss francs, after a Citigroup analyst said the biotechnology company was “an intriguing potential target” for AstraZenec, another Swiss drugs giant.
It was a good day for German power companies. RWE added 2.9 per cent after Reuters reported that Russian billionaire Mikhail Fridman may join a group of investors to bid for its oil and gas unit. EON gained 1.3 per cent to €14.09 after the Social Democratic Party’s call to increase nuclear fuel tax by 30 per cent was omitted from the latest discussion document for coalition talks.
Activist investor Carl Icahn reported a 12.6 per cent stake in medical device maker Hologic, prompting the company to adopt a shareholder rights plan to protect itself from hostile takeovers. Hologic shares rose 3.2 per cent to $23.
Sears Holdings, which operates its eponymous department stores and the Kmart discount chain, reported a wider quarterly net loss as sales fell and it invested in more promotions. Shares edged up 0.5 per cent to $62, reversing a pre-market drop.
Youth clothing outfit Abercrombie & Fitch reported a quarterly loss, with comparable-store sales declining for a seventh straight quarter as it struggles with the changing tastes of young shoppers, but its shares added 0.4 percent to $35.13 after having also fallen in pre-market trading.
Shares of General Motors rose 2.4 per cent to $38.59 after the US Treasury Department said it expected to sell its remaining GM shares by the end of the year, a plan that may leave US taxpayers with a shortfall of about $10 billion on the its 2009 bailout. – (Additional reporting: Bloomberg and Reuters)