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LONDON: European equities fell yesterday despite a raft of largely positive company results, with trading volumes boosted by the resumption of activity in storm-struck New York. London’s FTSE 100 index of top companies dropped 1.15 percent to 5,782.7 points, while in Frankfurt the DAX 30 slid 0.33 percent to 7,260.63 points, and in Paris the CAC 40 gave up 0.87 percent to 3,429.27 points.
US stock markets dropped after returning from a historic two-day closure forced by super-storm Sandy, which completely shut down the US financial capital of New York. Even though much of the city was still suffering the effects of power outages, flooding and wind damage, trading was smooth on the New York Stock Exchange and the tech-rich Nasdaq exchange, which were running on backup generators.
European officials denied that a deal had been reached that would see Greece receive bailout funds needed to stave off bankruptcy next month, while Athens released even worse growth and debt forecasts as part of its 2013 budget.
Spain’s and Italy’s 10-year bond yields, a sign of stress in the eurozone, continued their downward slide. The rate of return for investors on Spanish 10-year bonds dropped to 5.616 percent from 5.670 percent on Tuesday. The yield on 10-year Italian bonds slid to 4.960 percent from 4.994 percent.
Strong corporate earnings had provided the markets with an early boost. The French oil group Total said that adjusted third-quarter net profit spiked 20 percent to ¤3.348bn, boosted by high oil prices and improved refining margins in Europe. Total shares nonetheless closed down 0.44 percent to ¤38.82.
Shares in ArcelorMittal fell 6.43 percent to ¤11.43 after the group reported a plunge into third-quarter loss and cut its dividend owing to weak demand in China and Europe. GDF Suez posted a 5.8-percent hike in its earnings before interest, taxes, depreciation and amortisation for the first nine months of the year.
Europe’s airline sector also lit up traders’ radar screens, with Air France-KLM and Lufthansa posting better-than-expected results for the third quarter. Their shares increased by 8.37 percent and 7.33 percent respectively. In London, Barclays bank shares sank 4.73 percent to 227.5 pence after announcing that it fell into a nine-month net loss because of huge accounting charges. The lender also revealed that it faced two new investigations in the United States, adding to a string of probes that have hit the bank’s reputation. AFP