Markets end year with a whimper

Greece and oil were among the factors dragging down markets yesterday as the year neared its end with a whimper. In Dublin traders described the day as one of the slowest of 2014.

DUBLIN

Bank of Ireland

was one of the few Irish shares to trade in any volume, with approximately 60 million changing hands. Traders said there was no particular topic driving the turnover, and the stock closed at €0.31, a fall of 1.26 per cent

CRH closed at €19.54, a fall of 1.06 per cent, while Aer Lingus rose by 1.09 per cent, to close at €2.22.

The Iseq index of Ireland shares closed at 5,212.93, a fall of 0.37 per cent.

LONDON

Lower oil prices and renewed uncertainty over Greece’s future in the euro saw the London market’s recent festive cheer come to an end.

With the FTSE 100 Index 86.5 points lower at 6547, the top flight completed its first negative session since December 15th. The slump in London came even though better-than-expected sales figures from Next triggered a decent session for retail-based stocks.

Commodity firms dominated the fallers board after the price of Brent crude oil dived to a five-and-a-half year low of near to 57 US dollars a barrel.

BG Group was 21.1p lower at 868.6p, Royal Dutch Shell fell 45.5p to 2,239p and BP dropped 8.7p to 409.3p.

Next reported a 2.9 per cent rise in full-price sales for the period between October 28th to December 24th, meaning it is on track to outperform its forecast of 1 per cent growth for the quarter to January.

Following the trading update, Next said full-year profits should be £775 million – £5 million higher than at the time of a profits warning in October.

The company also pleased the City with plans for a 50p a share special dividend, causing its shares to rally by more than 3 per cent or 210p to 6725p.

Marks & Spencer fell 5.7p to 477.5p ahead of its own statement. Tesco was 1.55p lower at 186.9p and Morrisons was down 0.5p to 182.5p.

But in the FTSE 250 Index, catalogue retailer N Brown rose almost 6 per cent or 20.5p to 377.3p and Superdry owner SuperGroup lifted 22.5p to 898p.

EUROPE

A wave of risk aversion swept through markets as general end-of-year caution and worries about Greece’s future in the euro zone subdued shares and lifted the safe-haven yen and gold.

Germany’s DAX and France’s CAC 40 were down 1.2 and 1.1 per cent respectively. But Greece’s bond yields, a proxy of the government’s borrowing costs, steadied as investors took a relatively sanguine view of snap elections that are likely to empower a party seeking to flout international bailout terms. The left-wing Syriza party, which opposes the European Union/International Monetary Fund bailout, has said it wants to abandon many of the drastic spending cuts that are central to Greece’s rehabilitation programme.

But if market reaction is anything to go by, investors see the threat posed by Greece to the euro zone as far better contained than the first time around.

NEW YORK

Wall Street, where the S&P 500 notched its latest record high on Monday, was lower. The benchmark index is on track to close its third-straight year of double-digit positive returns.

The Dow Jones industrial average was down 57.92 points, or 0.32 per cent, at 17,980.31. The Standard & Poor’s 500 Index was down 6.75 points, or 0.32 per cent, at 2,083.82. The Nasdaq Composite Index was down 17.01 points, or 0.35 per cent, at 4,789.91.

Energy and utility shares lost more than 0.7 per cent. Oil companies slumped, with Southwestern Energy Co and Range Resources Corp declining more than 3 per cent. Energy companies have slid 9.3 per cent as a group this year for the biggest loss in the SandP 500, as crude prices have tumbled into a bear market. – (Additional reporting: Bloomberg/Reuters)