Global markets trade close to flat

Global markets traded close to flat yesterday, as investors watched the US financial-reporting season amid concern that recent gains in share prices have overshot the earnings potential.

DUBLIN

The Irish market gave up 14.8 points, or 0.4 per cent, to close down at 3,466.68, as it followed trends across the globe.

On a quiet news day, Aer Lingus was an out-performer, advancing by three cent, or 2.6 per cent, to finish the day up at €1.20.

Elsewhere, there was little movement. Ahead of its trading update tomorrow, CC traded almost flat on the day, adding two cent, or 0.5 per cent, to close at €4.50.

There was a little weakness in CRH, and it gave up four cent, or 0.3 per cent, to finish down at €14.89.

LONDON

UK stocks fell from a four and a half year high, as British business confidence declined in December, outweighing a US central banker’s recommendation of continued stimulus to support the country’s economy.

The FTSE 100 dropped 13.72 points, or 0.2 per cent, to 6,107.86 at the close in London.

“After such a good run in global equities, one would expect a correction at some point before markets go higher once again,” said Richard Scrope, fund manager at Oriel Asset Management in London, adding, “The UK economy is in poor shape and, without some growth, it’s likely to struggle.”

Imagination Technologies slumped by 6.4 per cent to 435.3 pence after Goldman Sachs said that Samsung Electronics has used a competitor’s technology in its new range of smartphones.

Lloyds advanced by 1.6 per cent to 54.9 pence after the Sunday Times reported that chief executive Antonio Horta-Osorio may get a £4.4 million bonus because he beat targets tied to the company’s strategy and customer complaints. A Lloyds spokesman declined to comment.

ITV added 1.6 per cent to 111.7 pence after the Telegraph reported that the company may return cash to shareholders when it publishes its annual results in February.

EUROPE

European stocks declined for a third day, ahead of the US earnings session.

The Stoxx Europe 600 Index fell by 0.3 per cent to 286.19, for the longest stretch of losses in four weeks. France’s Cac 40 rose by 0.2 per cent, while in Germany, the Dax climbed by 0.3 per cent.

Shares in Dutch delivery firm TNT plunged by 42 per cent to €4.75, for the biggest decline on the Stoxx 600 after UPS scrapped its proposed €5.16 billion takeover. It scrapped the deal because it expects European antitrust regulators to block the transaction.

UPS will pay TNT €200 million and withdraw the offer if the deal fails. PostNL NV, which has an almost 30 per cent stake in TNT, tumbled 36 per cent to €1.82.

EDF rose by 5.4 per cent to €14.40, for the biggest increase since November 2011. The French utility said it will receive €4.9 billion in staggered payments through December 2018. The compensation relates to deficits in the Contribution to Electricity Public Services mechanism, EDF said.

NEW YORK

The Standard & Poor’s 500 Index slipped from near a five-year high as Apple slumped amid concern about iPhone sales. The technology group lost 2.7 per cent and was the biggest drag on the S&P 500 after the Nikkei newswire reported that the company scaled back production plans for the iPhone because sales trailed expectations.

“Apple is the story for the market,” James Paulsen, the chief investment strategist at Minneapolis-based Wells Capital Management said.

Elsewhere, investors are looking to earnings results. Goldman Sachs Group, EBay and General Electric are among S&P 500 companies due to report earnings this week.

(Additional reporting: Reuters/Bloomberg)