Stocks fall across Europe as rally ends

European stocks fell the most in almost two weeks as investors assessed equity valuations following the biggest rally since March. National benchmark indices fell in all western European markets except Iceland yesterday.

France’s CAC 40 retreated 1.4 per cent, while the UK’s FTSE 100 lost 0.6 per cent and Germany’s DAX slipped 1 per cent. On the Irish Stock Exchange, the Iseq overall index closed down 1.1 per cent at 4,751.69.

DUBLIN Most of the top stocks on the Irish market were in retreat yesterday. Building materials group CRH closed 0.8 per cent down at €19.17, while food companies Aryzta, Glanbia and C&C also finished lower. Packaging group Smurfit Kappa was 1.6 per cent down at €15.65.

Both airlines hit turbulence in trading. Aer Lingus closed down 2.8 per cent while Ryanair finished 2 per cent lower.

The property Reits all finished ahead: Green closed up 0.3 per cent at €1.284, Hibernia was 0.7 per cent higher at €1.128, and Irish Residential Properties was 3 per cent higher at €1.047.

Investment group TVC Holdings said it anticipated that trading in its ordinary shares on the AIM in London and ESM in Dublin would cease at the close of business on July 25th.

Bank of Ireland, CRH, Ryanair, Smurfit Kappa and Kerry were the most traded stocks.

LONDON UK stocks retreated the most in almost two weeks, as miners fell after metals prices dropped on speculation the US Federal Reserve may raise rates sooner than anticipated. Antofagasta and African Barrick Gold declined at least 1.4 per cent each.

Weir Group climbed 0.7 per cent after Citigroup recommended investors buy shares of the maker of mining and construction equipment.

The FTSE 100 lost 42.54 points, or 0.6 per cent, to 6,823.51, the biggest decline since June 25th. The equity gauge has advanced 1.2 per cent so far this month, after US payrolls data topped projections and the European Central Bank discussed details of its stimulus plans. The FTSE All-Share index fell 0.7 per cent.

Ten out of 14 members in the FTSE 350 mining index retreated. Ireland's Tullow Oil declined 3.1 per cent to 817.5 pence, its biggest drop since February 13th.

EUROPE Sky Deutschland and Deutsche Börse slipped at least 2.5 per cent each after brokerages downgraded the shares. TeliaSonera and Tele2 advanced after the Swedish company agreed to buy Tele2's Norwegian business.

PostNL rallied the most in more than two years after boosting its profit forecast.

The Stoxx Europe 600 index dropped 0.9 per cent to 344.8 at the close of trading in London, with all 19 industry groups retreating. The index traded at 15.6 times the estimated earnings of its members on July 4th, near its highest valuation since 2009.

In Germany, data from the economy ministry in Berlin showed industrial production slipped 1.8 per cent in May.

Enagas rose 4 per cent to €24.06. JPMorgan Chase raised its rating to overweight, from neutral. The brokerage said the Spanish government's new gas regulation was not tougher than expected, and lower taxes would allow Enagas to maintain its dividend.

NEW YORK US stocks dropped in early trading from a record, led by declines in small-cap companies, as analysts brought forward estimates for the Federal Reserve to raise interest rates.

Commodities slumped as oil and metals retreated. The Standard & Poor’s 500 slipped 0.39 per cent in New York. The Russell 2000 index tumbled 1.77 per cent, the most since May. The yield on Treasury three-year notes climbed one basis point, while 10-year rates dropped three points.

The S&P GSCI index of 24 commodities slumped 0.63 per cent, as silver lost 0.58 per cent and US natural gas erased 4.11 per cent. – (Additional reporting: Bloomberg)