Friday June 26, 2009
LONDON: European stock exchanges closed in negative territory on Thursday, dragged down by data showing that more US workers applied for jobless benefits last week than had been expected.
The London FTSE 100 index fell 0.64 percent to finish at 4,252.57 while in Paris the CAC 4O dropped 0.68 percent to close at 3,163.10. The Frankfurt Dax lost 0.73 percent to finish at 4,800.56 points.
Elsewhere in Europe there were declines of 1.51 percent on the Swiss Market Index, 0.52 percent in Milan, 0.2 percent in Amsterdam and 0.03 percent in Brussels. Share prices in Madrid rose 0.52 percent on the day.
On Wall Street stocks swung higher Thursday as investors responded to a small upward revision in US economic output.
But the uptick in new US jobless claims kept trading cautious.
The Dow Jones Industrial Average at mid-day was up 0.53 percent at 8,344.15 while the Nasdaq had gained 1.46 percent to reach 1,818.49.
Market action came after the government reported that the US economy contracted at a 5.5 percent pace in the first quarter, not as bad as the previous estimate of a 5.7 percent drop.
Analysts said the report was consistent with other signals suggesting the worst slump in decades would soon be over.
"All the incoming data suggest that economic activity contracted at a much slower rate in the second quarter -- 2.5 to 3.0 percent -- and that the trough of this cycle is likely to occur sometime in August or September," said Nariman Behravesh at IHS Global Insight.
Behravesh said he "now expects the economy to be more or less flat in the third quarter and grow around 1.0 percent in the fourth quarter."
But the positive tone was soured by a report that new claims for US unemployment benefits climbed for the second consecutive week last week.
Initial claims for unemployment insurance benefits rose to a seasonally adjusted 627,000 in the week ended June 20 from an upwardly revised 612,000 claims in the prior week, the Labor Department said.
Most analysts had expected new claims of 600,000.
"The prevailing message remains that the labor market is weak and that's not a great portent for consumer spending or the housing recovery," said Patrick O'Hare of Briefing.com.
In London British Airways edged up 0.07 percent to 345 pence. The company said 800 employees had agreed to work for free while 7,000 would take a pay cut in order to help the carrier cut its losses.
In Paris trading was described as volatile, with Wednesday's gains reversed.
Oil group Total weighed heavily on the market, falling 1.19 percent to 38.04 euros on rumours that it might have to downgrade its financial targets.
Credit Agricole bank shed 3.90 percent to close at 9.14 euros after two brokerages lowered their profit predictions for the lender.
In Frankfurt chemical group BASF gave up 2.46 percent to end the session at 28.17 euros after announcing the closure of a plant in Germany in the face of weak demand.
Auto maker Volkswagen lost 3.19 percent to finish at 242.50 euros. Press reports said VW could form a cooperation alliance with Suzuki of Japan, possibly taking a 10 percent stake.
In Asia Thursday, Japanese shares jumped 2.15 percent, boosted by gains on other Asian markets and a weak yen, which is good for exporters. Hong Kong stocks soared 2.14 percent.
(AFP)
LONDON: European stock exchanges closed in negative territory on Thursday, dragged down by data showing that more US workers applied for jobless benefits last week than had been expected.The London FTSE 100 index fell 0.64 percent to finish at 4,252.57 while in Paris the CAC 4O dropped 0.68 percent to close at 3,163.10. The Frankfurt Dax lost 0.73 percent to finish at 4,800.56 points.
Elsewhere in Europe there were declines of 1.51 percent on the Swiss Market Index, 0.52 percent in Milan, 0.2 percent in Amsterdam and 0.03 percent in Brussels. Share prices in Madrid rose 0.52 percent on the day.
On Wall Street stocks swung higher Thursday as investors responded to a small upward revision in US economic output.
But the uptick in new US jobless claims kept trading cautious.
The Dow Jones Industrial Average at mid-day was up 0.53 percent at 8,344.15 while the Nasdaq had gained 1.46 percent to reach 1,818.49.
Market action came after the government reported that the US economy contracted at a 5.5 percent pace in the first quarter, not as bad as the previous estimate of a 5.7 percent drop.
Analysts said the report was consistent with other signals suggesting the worst slump in decades would soon be over.
"All the incoming data suggest that economic activity contracted at a much slower rate in the second quarter -- 2.5 to 3.0 percent -- and that the trough of this cycle is likely to occur sometime in August or September," said Nariman Behravesh at IHS Global Insight.
Behravesh said he "now expects the economy to be more or less flat in the third quarter and grow around 1.0 percent in the fourth quarter."
But the positive tone was soured by a report that new claims for US unemployment benefits climbed for the second consecutive week last week.
Initial claims for unemployment insurance benefits rose to a seasonally adjusted 627,000 in the week ended June 20 from an upwardly revised 612,000 claims in the prior week, the Labor Department said.
Most analysts had expected new claims of 600,000.
"The prevailing message remains that the labor market is weak and that's not a great portent for consumer spending or the housing recovery," said Patrick O'Hare of Briefing.com.
In London British Airways edged up 0.07 percent to 345 pence. The company said 800 employees had agreed to work for free while 7,000 would take a pay cut in order to help the carrier cut its losses.
In Paris trading was described as volatile, with Wednesday's gains reversed.
Oil group Total weighed heavily on the market, falling 1.19 percent to 38.04 euros on rumours that it might have to downgrade its financial targets.
Credit Agricole bank shed 3.90 percent to close at 9.14 euros after two brokerages lowered their profit predictions for the lender.
In Frankfurt chemical group BASF gave up 2.46 percent to end the session at 28.17 euros after announcing the closure of a plant in Germany in the face of weak demand.
Auto maker Volkswagen lost 3.19 percent to finish at 242.50 euros. Press reports said VW could form a cooperation alliance with Suzuki of Japan, possibly taking a 10 percent stake.
In Asia Thursday, Japanese shares jumped 2.15 percent, boosted by gains on other Asian markets and a weak yen, which is good for exporters. Hong Kong stocks soared 2.14 percent.
(AFP)
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