National benchmark indexes declined in 16 of 18 western European markets. Britain’s FTSE 100 Index fell 0.6 per cent, France’s CAC-40 slid 1.4 per cent and Germany’s DAX dropped 1 per cent. US stocks also fell slightly, while in Dublin, the Iseq was down marginally 0.17 per cent to 4,550.54.
The weak market was explained by traders as being investors locking in profits because of concern of what one Dublin trader called an “overdue correction”. Russia banning a range of food imports from the US and Europe added to the uncertainty.
DUBLIN
Irish food stocks all performed strongly despite concerns about a Russian ban on food imports from the US and Europe.
Kerry Group was up 3.19 per cent to €55.07 and Glanbia also rose 2 per cent to €11.73. Goodbody recommended that investors "hold" Kerry yesterday as its performance stayed in line with expectations.
Providence Resources, which is well down from historic peaks, regained some ground, rising 6.46 per cent to €1.36. FBD was down 1 per cent to €13.60. Davy said in note yesterday that results from Aviva and RSA revealed a "contrasting experience" for insurance firms operating in the Irish market.
Among other major movers, Fastnet Oil & Gas was down 27 per cent to 7 cents on tiny volumes. Bank of Ireland was down 0.38 per cent to 26 cents, CRH was down 1.26 per cent to €16.90 and Ryanair was down 1.08 per cent to €6.61. Traders described business as "slow" and dampened by investors going on holiday.
LONDON
Insurance stocks were in focus as the latest stage of Aviva’s recovery cheered investors while rival RSA lost ground after admitting that its own turnaround would be more costly than expected.
Aviva shares were nearly 3 per cent, or 12.8p, higher to 502.5p, as chief executive Mark Wilson reported a 4 per cent rise in operating profits, to £1.05 billion.
Meanwhile results from RSA showed the challenge facing Stephen Hester, the former Royal Bank of Scotland boss brought in earlier this year as chief executive. It reported half-year profits of £69 million, against £250 million a year ago.
Budget airline EasyJet was on the back foot after a downgrade from analysts at Barclays, citing limited earnings momentum through the winter and concerns over its capacity growth. The stock slipped 3 per cent, or 44p, to 1,239p.
EUROPE
European stocks fell to their lowest level in more than 3½ months as ECB president Mario Draghi warned that geopolitical risks in countries such as Ukraine could hurt the economic recovery, while Munich Re’s earnings missed forecasts.
Munich Re slipped 2.3 per cent. Adidas lost 4.5 per cent after cutting its profit forecast for 2014. Commerzbank rose after saying second-quarter profit more than doubled as it shed unwanted assets.
Nestlé added 3.4 per cent after it announced plans for a share buyback as first-half revenue growth beat analysts' estimates. Beiersdorf fell 1.8 per cent to €65.97. The maker of Nivea body wash reported first- half organic sales growth of 5 per cent as revenue in western Europe advanced less than in other markets.
NEW YORK
US stocks fell in choppy trading as a sanctions confrontation between Russia and the West kept traders eager to cash any gains.
The S&P 500 had risen as much as 0.45 per cent on the back of some strong earnings and a surprise tick lower in applications for unemployment insurance, before selling off to trade below its 100-day moving average for a second consecutive session.
Twenty-First Century Fox climbed 5 per cent as X-Men: Days of Future Past and Rio 2 led to a jump in income at its film business.
Executives stressed they would not make a new approach for Time Warner after withdrawing an $80 billion bid. – (Additional reporting Bloomberg, Reuters)
