European shares fell back into negative territory yesterday, having briefly flourished on Tuesday.
Following the largest three-day slump in seven months over the last week there was optimism that Tuesday’s rebound would not be temporary.
The Turkish Central Bank’s decision to make massive interest rate hikes to stem the fall of the lira however, has reignited fears in equity markets over support for emerging market currencies.
The Stoxx Europe 600 Index dropped 0.6 per cent to 322.38 at the close of trading, paring earlier losses of as much as 1.5 per cent.
In London, the FTSE 100 lost 0.4 per cent, while Germany's DAX slid 0.8 per cent and France's CAC 40 retreated 0.7 per cent. The Swiss Market Index fell 0.6 per cent. In Dublin, the Iseq Overall index was up by just 0.04 per cent to 4,723.35.
Trading volumes were relatively low outside of Bank of Ireland, which put in a "stellar performance," according to one analyst.
It closed up 6.23 per cent with 57 million shares traded. Dealers said investors are looking at the bank with a fresh pair of eyes, and considering them on an earnings basis rather than on price to book.
Ryanair was down 2.27 per cent with dealers saying investors are continuing to review both Ryanair and its main rival EasyJet's latest results.
EasyJet last week warned that the timing of Easter would likely affect its first-half earnings.
Paddy Power followed other European gaming firms down as markets continually worry about proposed legislative changes being considered by the UK government.
It closed down 0.25 per cent with 93,000 shares traded.
Packaging group Smurfit was also lower despite a positive reaction following the publication of US peer Rock Tenn first quarter results earlier this week, which highlighted maintenance downtime for the company.
Smurfit closed down 1.43 per cent.
UK stocks slid, pushing the FTSE100 Index toward its biggest monthly drop since August. Supermarket chain J Sainsbury lost 2.3 per cent after saying Justin King will step down as chief executive officer in July.
Elsewhere, retailer Mulberry Group tumbled 27 per cent as the handbag maker projected full-year pre- tax profit that fell short of analysts' estimates.
Fiat slid 4.1 per cent to € 7.24 after the Turin-based carmaker said fourth-quarter earnings before interest, taxes and one-time items rose 5 per cent to €931 million from €887 million a year earlier.
A gauge of car-related stocks posted the second-worst performance of the 19 industry groups on the Stoxx Europe 600 Index.
Volkswagen slid 2 per cent to € 191.70 and BMW lost 0.9 per cent to 80.83.
Nordea Bank lost 2.3 per cent to 87.85 kronor after Scandinavia's biggest bank said it will need to cut more than the 2,500 jobs already axed to adjust to slow growth.
Wall Street stocks fell in early trading as concerns about the impact of a possible cut in the Federal Reserve's monthly bond-buying programme kept investors cautious.
In earnings, Boeing shares fell 5 per cent to $130.27 despite reporting a jump in quarterly profit due to a rise in commercial aircraft deliveries.
Yahoo shares plunged 6.5 per cent to $35.70 a day after announcing a decline in online ad prices which hurt its revenue for a fourth consecutive quarter.
Alibaba, the Chinese e-commerce giant in which it owns a big stake, saw revenue growth decelerate. – (Additional reporting: Reuters)