EQUITY MARKETS softened yesterday as mixed economic data unnerved investors awaiting today’s key US jobs report.
Markets were heartened by encouraging initial jobless claims numbers out of the US, but disappointing service sector data for the world’s largest economy reversed the earlier bounce.
DUBLIN
THE ISEQ index shed about 0.5 per cent yesterday to close at 3,252.53.
The main driver behind this decline was CRH, which traded down in line with its sector after its German peer HeidelbergCement reported poor results.
“That could have a read through for CRH,” a Dublin broker noted.
CRH, which is due to issue an interim management statement next week, closed down 1.3 per cent, or almost 21 cent, at about €15.27.
Reports that Denis O’Brien had acquired an additional 5 per cent of Independent News & Media, taking his stake to 27 per cent, proved the main talking point on the Irish market yesterday.
The newspaper and media group’s share price, which has been trading in the 24-27 cent range in recent sessions, closed yesterday at 31.7 cent.
Aer Lingus also finished in positive territory, up 1.5 cent at 99 cent, after reporting a smaller first-quarter operating loss.
LONDON
UK STOCKS advanced as Smith and Nephew, Europe’s biggest maker of artificial hips and knees, rose 4 per cent after earnings topped estimates.
BG Group, the UK’s third- largest gas producer, dropped 1.8 per cent after reporting an increase in spending. Antofagasta tumbled 4.4 per cent as its copper output decreased.
The FTSE 100 Index added 8.44, or 0.2 per cent, to 5,766.55 at the close in London, having earlier rallied as much as 0.7 per cent.
The gauge has gained 3.5 per cent in 2012 as investors bet growth in the US and China will outweigh spending cuts in the euro area.
The FTSE All-Share Index advanced 0.1 per cent. “Once again it has been poor US data that has scuppered this rally,” said Chris Beauchamp, a market analyst at IG Index.
“It appears that, as we move towards non-farms [today] the outlook is firmly downbeat.”
EUROPE
EUROPEAN STOCKS were little changed as the president of the ECB said policymakers didn’t discuss cutting interest rates, offsetting earnings from Transocean that beat estimates.
Delhaize dropped 10 per cent after the owner of the Food Lion stores in the US posted quarterly results that missed projections.
The Stoxx Europe 600 Index gained 0.1 per cent to 257.53, after earlier advancing as much as 1 per cent and retreating as much as 0.4 per cent.
The volume of shares changing hands on the Stoxx 600 was 1.1 per cent lower than the average of the last 30 days.
The ECB kept its benchmark interest rate at a record low of 1 per cent. Stocks erased gains after ECB president Mario Draghi, speaking at a press conference in Barcelona, said the central bankers did not talk about cutting rates.
While the ECB still expects a gradual economic recovery this year, “downside risks” prevail and the outlook has become “more uncertain”, Mr Draghi said.
National benchmark indexes slid in 10 of the 18 western European markets. France’s CAC 40 lost 0.1 per cent and Germany’s DAX decreased 0.2 per cent.
US
US STOCKS retreated yesterday, sending the Standard and Poor’s 500 index lower for a second straight day, after disappointing service industries numbers overshadowed optimism over a bigger-than-forecast drop in jobless claims.
Bank of America and Hewlett-Packard fell at least 1.2 per cent to pace losses among the biggest companies. Target slumped 2.5 per cent after April same-store sales trailed estimates.
Green Mountain Coffee Roasters plunged 47.8 per cent to $25.87 as profits will be less than expected. The company is seeing more competition from private-label capsules that fit into Keurig machines, and from Starbucks, which said it will begin selling its own single-serve brewer this year.
The company has introduced the Vue coffee machine to help combat rivals when the main patents for its K-Cups expire in September.
Carlyle Group rose as much as 2.1 per cent in its first day of trading.
Equities fell as the Institute for Supply Management’s index of non-manufacturing industries, which account for almost 90 per cent of the US economy, decreased to 53.5 in April from 56 a month earlier.
Jobless claims fell to 365,000 in the week ended April 28th, a one-month low.
The median forecast of economists called for 379,000 applications. – (Additional reporting Bloomberg)
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