A US economic contraction in the fourth quarter put pressure on stocks in Europe and the United States yesterday even as it bolstered expectations that the US central bank will continue its easy monetary policy and keep the euro near a 14-month high.
DUBLIN
The Dublin market was generally weaker yesterday, on par with its European peers, which are all limping to the end of month close, according to one stockbroker.
CRH, Smurfit Kappa, Ryanair and CC were the most traded stocks of the day.
Pharmaceutical firm Elan was the star performer of the day, following strong demand in the US overnight, finishing up nearly 5 per cent at €7.66.
Food group Glanbia also held on to gains to recent days, rising to €8.26, while Kerry Group gained just over 1 per cent to close at €38.62.
LONDON
The recent rally on the London market was brought to a halt today after figures revealed a shock contraction in the US economy at the end of last year.
The FTSE 100 Index closed 16.1 points lower at 6,323.1, having surged above 6,300 for the first time in more than 4½ years last night.
Advertising firm WPP climbed to a 12-year high as Jefferies Group advised investors to buy the shares.
Phoenix Group Holdings soared 9.3 per cent, the largest gain since June. The UK’s biggest manager of closed life-insurance funds plans to raise £250 million in a share sale to lower its debt burden.
Imagination Technologies Group rallied 13 per cent, snapping five days of losses.
EUROPE
European stocks dropped the most this year as Saipem plunged and a report showed that the US economy unexpectedly contracted in the fourth quarter.
Saipem slumped 34 per cent to €20.01, its biggest slide since at least December 1988. The oil and gas contractor lowered its forecast for earnings before interest and taxes in 2012 by 6 per cent to about €1.5 billion.
Swedbank jumped the most in 32 months after the lender raised its dividend payout ratio to 75 per cent of profit after net income more than quadrupled in the fourth quarter. Nordea Bank rose 3.2 per cent after reporting quarterly profit that beat analysts’ estimates.
Luxottica Group added 2.3 per cent to €34.36, its highest since its initial public offering on Italy’s stock market in December 2000. The owner of the Oakley and Ray-Ban sunglasses brands said sales rose 14 per cent in 2012 to €7.09 billion.
France’s CAC 40 and Germany’s DAX both fell 0.5 per cent.
US
US stocks fell yesterday after the Federal Reserve said in its latest statement that economic growth had stalled but indicated that it was likely temporary.
Stocks were flat for most of the session prior to the Fed statement at the end of a two-day policy meeting. The Fed repeated its pledge to keep purchasing securities until employment improves substantially.
Chesapeake Energy rose 6 per cent to $20.11 a day after it said Aubrey McClendon would step down as chief executive. The company has had a tumultuous year in which a series of investigations triggered civil and criminal examinations of the second-largest US natural gas producer.
After the bell, shares of Facebook fell 5.9 per cent to $29.40 following the company’s earnings announcement. Facebook said its revenue in the fourth quarter grew 40 per cent year-on-year to $1.585 billion.
Both Boeing and Amazon.comshares gained after earnings beat expectations, continuing a trend this quarter of high-profile names advancing after results. Amazon rose 4.8 per cent to $272.76 and Boeing rose 1.3 percent to $74.59.
Research In Motion shares fell 12 per cent to $13.78 after the company, which is changing its name to BlackBerry, unveiled a long-delayed line of smartphones in hopes of a comeback into a market it once dominated. – (Additional reporting: Bloomberg, Reuters)
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