Quantcast
Connect with us

European stocks drop as eurozone returns to radar

Published

on

European stock markets fell on Friday as emerging markets turmoil offsets solid economic growth and upbeat company earnings in the United States.

And after a few days out of the spotlight, investor focus has returned to the eurozone as official data showed unemployment across the bloc stayed close to a record-high rate of 12.0 percent in December.

ADVERTISEMENT

It comes as Germany’s retailers reported a shock drop in business during the same month, according to volatile data produced by the federal statistics office Destatis.

On the upside, Spanish banking group BBVA announced a 33-percent leap in annual net profits. Shares in French luxury giant LVMH jumped 5.88 percent on record sales last year, pulling up the sector.

In morning deals, London’s benchmark FTSE 100 index slipped 0.33 percent to 6,516.79 points and in Frankfurt the DAX 30 shed 0.94 percent to 9,285.51 points.

The CAC 40 in Paris lost 0.38 percent to 4,164.02 points compared with Thursday’s close. Madrid’s IBEX 35 index dropped 0.34 percent to 9,931.

ADVERTISEMENT

In Amsterdam shares in Altice, the parent of French cable operator Numericable, rose by 2.3 percent to 28.90 euros when they were floated.

But in Paris, shares in nuclear power giant Areva fell by 3.41 percent to 19.8 euros on a fall in fourth-quarter sales.

The euro fell against the dollar, while the price of gold edged higher.

ADVERTISEMENT

The Turkish lira firmed slightly, to 2.2502 to the dollar from 2.2655 late on Thursday and to 3.0484 to the euro from 3.0715.

“People have been rather preoccupied with emerging markets over the last couple of weeks and everything else seems to have taken a back seat,” Rebecca O’Keeffe, head of investment at stockbroker Interactive Investor, told AFP.

“The U.S. economy continues to go from strength to strength, with many companies beating analyst expectations,” O’Keeffe said. “This is providing a relatively stable backdrop against the current emerging market currency crises and concerns about China.”

ADVERTISEMENT

O’Keeffe said “the eurozone does have the potential for positive surprises with the outlook in Germany, the UK and Spain as well as some other peripheral countries increasingly favorable.”

She added: “France and Italy remain a worry, but overall Europe appears to be on the right track.”

Official data published on Friday showing that eurozone inflation fell to 0.7 percent in January added to concerns about the bloc’s ability to cement economic recovery.

ADVERTISEMENT

“The latest eurozone unemployment and inflation data maintain the pressure on the ECB to do more to ward off deflation risks, perhaps as soon as next week,” said Jonathan Loynes, chief European economist at consultants Capital Economics.

In foreign exchange trading on Friday, the euro fell to $1.3540 from $1.3554 late in New York on Thursday.

Gold, seen as a haven investment, rose to $1,246.50 an ounce from $1,242.50 an ounce on Thursday on the London Bullion Market.

ADVERTISEMENT

Emerging market currencies steady

“Even with some of the under pressure emerging market currencies having started to show first signs of stabilizing there is still plenty of uncertainty in the markets where these individuals countries are concerned and their ability to gain back investor?s confidence,” said Markus Huber, analyst at broker Peregrine & Black.

“In order to bring back calm into the markets, investors are also looking for assurances from organizations like the IMF, the World Bank and some of the major central banks that the global recovery won?t be in danger of being derailed by the current turmoil in some emerging market countries.”

ADVERTISEMENT

Helping to offset such concerns, the US Commerce Department said on Thursday that the world’s number one economy expanded 3.2 percent in October-December, well above the 3.0 percent projected by analysts.

There was some cheer also in reaction to figures showing a 3.3-percent rise in consumer spending, which is a crucial driver of growth in the United States.

The data came one day after the Federal Reserve reduced its stimulus program by another $10 billion a month to $65 billion, following a similar cut in December.

ADVERTISEMENT

While the US central bank cited a firming US economy for the wind-down, the announcement rattled emerging markets such as India, South Africa and Russia on fears of a capital flight, which in turn has sent their currencies diving this week.

Enjoy this piece?

… then let us make a small request. Like you, we here at Raw Story believe in the power of progressive journalism — and we’re investing in investigative reporting as other publications give it the ax. Raw Story readers power David Cay Johnston’s DCReport, which we've expanded to keep watch in Washington. We’ve exposed billionaire tax evasion and uncovered White House efforts to poison our water. We’ve revealed financial scams that prey on veterans, and legal efforts to harm workers exploited by abusive bosses. We’ve launched a weekly podcast, “We’ve Got Issues,” focused on issues, not tweets. And unlike other news outlets, we’ve decided to make our original content free. But we need your support to do what we do.

Raw Story is independent. You won’t find mainstream media bias here. We’re not part of a conglomerate, or a project of venture capital bros. From unflinching coverage of racism, to revealing efforts to erode our rights, Raw Story will continue to expose hypocrisy and harm. Unhinged from billionaires and corporate overlords, we fight to ensure no one is forgotten.

We need your support to keep producing quality journalism and deepen our investigative reporting. Every reader contribution, whatever the amount, makes a tremendous difference. Invest with us in the future. Make a one-time contribution to Raw Story Investigates, or click here to become a subscriber. Thank you. Click to donate by check.

Enjoy this piece?

… then let us make a small request. Like you, we here at Raw Story believe in the power of progressive journalism — and we’re investing in investigative reporting as other publications give it the ax. Raw Story readers power David Cay Johnston’s DCReport, which we've expanded to keep watch in Washington. We’ve exposed billionaire tax evasion and uncovered White House efforts to poison our water. We’ve revealed financial scams that prey on veterans, and efforts to harm workers exploited by abusive bosses. We’ve launched a weekly podcast, “We’ve Got Issues,” focused on issues, not tweets. Unlike other news sites, we’ve decided to make our original content free. But we need your support to do what we do.

Raw Story is independent. You won’t find mainstream media bias here. We’re not part of a conglomerate, or a project of venture capital bros. From unflinching coverage of racism, to revealing efforts to erode our rights, Raw Story will continue to expose hypocrisy and harm. Unhinged from corporate overlords, we fight to ensure no one is forgotten.

We need your support to keep producing quality journalism and deepen our investigative reporting. Every reader contribution, whatever the amount, makes a tremendous difference. Invest with us in the future. Make a one-time contribution to Raw Story Investigates, or click here to become a subscriber. Thank you.



Report typos and corrections to: [email protected]. Send news tips to: [email protected].
READ COMMENTS - JOIN THE DISCUSSION
Continue Reading

Breaking Banner

Has anything changed since Burning Man’s sex assault and labor issues were exposed?

Published

on

The last weekend in August marks the start of Burning Man, a week-long, festival in the Nevada desert consisting of freewheeling performance art, fanciful costumes, and a lot of drugs. The anarchic party with more than 50,000 attendees constitutes a pilgrimage for many attendees, lured by the promise of leaving the “default world” behind in exchange for a transformative or even spiritual experience.

This article originally appeared at Salon.

Continue Reading

Breaking Banner

Truckers are facing a ‘bloodbath’ in their industry — and it’s turning many in the pro-Trump group against him: report

Published

on

Truckers are numerous, conservative, and hurting. And despite their widespread support for Donald Trump’s candidacy in 2016, a new report from Business Insider suggests the pain in the industry might be turning these workers away from the president.

The political trends in trucking are not insignificant. According to the American Trucking Associations, there were an estimated 3.5 million truck drivers in 2018. RTS Financial has found that there are 7.4 million jobs total “tied to the trucking industry.” And Business Insider reported that nearly 90 percent of truckers are registered voters, higher than the general population.

Continue Reading
 

Breaking Banner

WATCH: Trump’s collusion with Russia is now a topic for impeachment — along with obstruction and racism

Published

on

President Donald Trump's interactions with Russia are now a topic of the impeachment investigation.

"There was an important development in support for impeachment proceedings in the House of Representatives today," MSNBC anchor Lawrence O'Donnell reported Tuesday. "Important both in who the new support comes from and what that support is based on."

"Congresswoman Lauren Underwood of Illinois is one of the freshmen Democrats who flipped a Republican district last year in winning her election. She brings the total number of House Democrats supporting impeachment now to 126 -- a majority of the Democrats' 235 members of the House," he explained.

Continue Reading
 
 

Thank you for whitelisting Raw Story!

As a special thank you, from now until August 31st, we're offering you a discounted rate of $5.99/month to subscribe and get ad-free access. We're honored to have you as a reader. Thank you. :) —Elias, Membership Coordinator
LEARN MORE
close-link
close-image