Log in
Login
Password
Remember
Lost password
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesHot NewsMost Read NewsRecomm.Business LeadersVideosCalendar 

EUROPE MARKETS: Europe Stocks Drop As Unemployment Hits New High

03/01/2013 | 12:18pm US/Eastern

By Sara Sjolin, MarketWatch

LONDON (MarketWatch) -- Upbeat U.S. manufacturing data helped European stock markets pare losses on Friday, after record high unemployment in the euro zone and weak business-activity data in China had kept bourses mired in deep red for most of the day.

The Stoxx Europe 600 index lost 0.3 % to close at 289.02, but gained 0.2% on the week, marking the second weekly gain in a row.

The index earlier this week found itself losing as much as 1.3% on the back of inconclusive election results in Italy. On Thursday however, European markets concluded February with a ninth straight monthly gain, as global central bankers signaled they would stick to current easing policies.

"One of the big take aways this week is to take a longer-term view of the markets. It's a question of looking at the long game and understand whatever may happen on a daily basis may not change anything from a company view," said Richard Hunter, head of equities at Hargreaves Lansdown.

"I'm still optimistic about the prospects for the end of the year and from a micro perspective there are still companies that continue to outperform," he added.

Pointing in the other direction on Friday, however, mining firms posted some of the biggest losses as a gauge of Chinese factories showed the manufacturing sector expanded at a slower pace in February.

The government-sponsored version of the manufacturing Purchasing Managers Index came in at 50.1, only marginally ahead of the 50-point threshold that signals an expansion. The figure marked a decline from January's 50.4-point level and missed expectations for 50.5 in a Dow Jones Newswires survey. See: China manufacturing grows marginally, surveys show

Shares of Rio Tinto PLC (>> Rio Tinto plc) lost 2.8%, Anglo American PLC (>> Anglo American plc (ADR)) fell 1.1% and BHP Billiton PLC (>> BHP Billiton Limited) slipped 0.4%.

Euro-zone data

Data out of the euro zone were also disappointing, with the region's unemployment rate jumping to 11.9% in January, a record and above expectations of a 11.8% reading.

Additionally, the final reading of Markit's purchasing-managers index showed the euro zone remained in contraction territory in February. The index printed at 47.9, up from a flash reading of 47.8. See: Weak euro-zone data spark speculation of ECB rate cut

Investors also looked to the U.S., where automatic spending cuts, referred to as the sequester, were slated to take effect on Friday, after bills from both the Democrats and the Republicans failed to get enough support in the Senate on Thursday. See: Sequester cuts near as Senate bills fail

Also of interest in the U.S., the manufacturing sector accelerated to the highest level in almost two years with the Institute for Supply Management's manufacturing index climbing 1.1 points to 54.2%, coming in ahead of expectations of a 52.5% reading. See: Manufacturing sector revs up in February

Meanwhile, the University of Michigan-Thomson Reuters consumer-sentiment gauge rose to a final February reading of 77.6 -- the highest level since November. See: Consumer sentiment at three-month high in February

"With the recent economic data being ahead of expectations and corporate data surprising to the upside, most of the dip buying we have seen has been led by long term investors," said Atif Latif, director of trading at Guardian Stockbrokers, in emailed comments.

"They still understand in the search for yield the equity market offers more upside than the negative real rate of return from the fixed income market."

U.S. stocks traded lower on Wall Street. See: Stocks moderate drop after manufacturing data

Banks decline

In Europe, banks found themselves among the biggest decliners. In the U.K., Lloyds Banking Group PLC (>> Lloyds Banking Group PLC) fell 2.2%, after posting a loss for 2012. The result was hit by extra provisions in the fourth quarter to cover potential claims from people who were wrongly sold insurance products, known as PPI. See: Lloyds hit by further PPI charges

Glencore International PLC (>> Glencore International Plc) erased 2.7%, after the commodities titan said it won't be able to complete its proposed merger with mining company Xstrata PLC by March 15, as intended. Xstrata shares fell 3.1%. See: Glencore-Xstrata merger won't be complete by March

The FTSE 100 index , however, closed 0.3% higher at 6,378.60 and was up 0.7% on the week.

Shares of Old Mutual PLC gained 4.4%. The financial group posted an increase in 2012 profit and set aside 5 billion rand ($561.8 million) to invest in Africa over the next three to five years. See: Old Mutual posts rise in profit, focus on Africa

Germany's DAX 30 index erased 0.4% to 7,708.16, with shares of Deutsche Bank AG (>> Deutsche Bank AG (USA)) 4.3% lower after Goldman Sachs cut the bank to sell from neutral. The German benchmark closed out the week 0.6% higher. See: Deutsche Bank down 6%, downgraded by Goldman Sachs

Outside the main index in Frankfurt, shares of Metro AG dropped 4.9%, after the retailer cut its dividend payments for 2012. See: Metro cuts dividend payments for 2012

France's CAC 40 index fell 0.6% to 3,699.91, sending it 0.2% lower on the week. Shares of Société Générale SA lost 2.6% and Credit Agricole SA erased 2.4%.

Elsewhere, Belgacom SA slumped 5.6%, as Belgium's largest telecom firm forecast lower sales and earnings in 2013 due to firm competition. See: Belgacom sees weaker earnings on more competition

React to this article
Latest news
Date Title
08:53aDJLONDON MARKETS : London Stocks Looking For Direction; Oil Stocks Fall
08:52a Valeant to buy U.S. surgical device supplier to enhance Bausch + Lomb business
08:52a IOSCO ORGANIZATION OF SECURITIES C : publishes Final Report on the Peer Review of Regulation of Money Market Funds
08:52a GENERAL MOTORS : GM Declares Dividend on Common Stock
08:52a ZETKAMA : CR 25/2015 of August 14, 2015 - The Proposed Resolutions of the Extraordinary General Shareholders Meeting of ZETKAMA S.A. on 15 September 2015.
08:52a POLSKI KONCERN NAFTOWY ORLEN : PKN ORLEN’s subsidiary – ORLEN Asfalt – has purchased bonds issued by PKN ORLEN
08:52a HELIO : Current report No 4/2015
08:52a TEE LAND : Disclosure of Interest / Changes in Interest of Director / Chief Executive Officer
08:51a PERRIGO : Animal Health :, Walmart Provide Ultimate Protection for Springfield, Mo., Police Patrol K-9s
08:50aDJPrivate Sector Jobs Rise 190,000 in August, ADP Report Says
Latest news
Advertisement
Hot News 
FISHING REPUBLIC : Profit Rises As It Plans More "Destination" Stores
DEINOVE : Produces Muconic Acid from 2G Substrates
HALFORDS : Trading Statement
SPACEANDPEOPLE : Wins Exclusive Brand Promotion Deal With Network Rail
R E A : Further re issue by REA Finance of sterling notes
Most Read News
09/01 EIA ENERGY INFORMATION ADMINISTRATION : Effects of Removing Restrictions on U.S. Crude Oil Exports ›
09/01 Women's Advocate-Paralympian-Actress Aimee Mullins Joins Legendary Voice Builder Gary Catona To Help Women Worldwide Raise Their Voices For Gender Equality With MY VOICE MATTERS
09/01 COMMODITIES : Winners, Losers
09/01 Gainey McKenna & Egleston Announces a Class Action Lawsuit Has Been Filed Against MaxPoint Interactive, Inc. (MXPT)
09/01 Intellectual Property Insurance Services Corporation (IPISC) to Provide Patent Troll Insurance to Members of the Association of National Advertisers (ANA)
Most recommended articles
08:50aDJPrivate Sector Jobs Rise 190,000 in August, ADP Report Says
08:48a U.S. second-quarter productivity strongest in one-and-a-half years
08:48aDJFrançois Hollande Appoints Myriam El Khomri as France's Labor Minister
08:48aDJBrazil's Industrial Production Falls 1.5% in July
08:46aDJU.S. Productivity Increases at 3.3% Pace in Second Quarter