Thursday February 12, 12:08 PM
European stocks slide amid mixed earnings
LONDON (AFP) - Europe's main stock markets slid on Thursday after heavy losses across Asia, as investors digested mixed earnings from majors and fretted over Washington's stepped-up rescue plan for ailing banks.
Approaching midday, London's FTSE 100 index of leading shares was showing a loss of 1.11 percent to 4,187.31 points. Frankfurt's DAX 30 (Xetra: news) dropped 2.05 percent to 4,436.00 points and in Paris the CAC 40 (Paris: news) dropped 1.64 percent to 2,977.92 near the half-way mark.
The DJ Euro Stoxx 50 index of leading eurozone shares declined 1.81 percent to 2,226.68 points.
The European single currency fell to 1.2828 dollars.
Asian markets continued to fall on Thursday as all eyes remained on the United States where a banking bailout deal received a cool response while a new stimulus is going through Congress.
Wall Street shares rose on Wednesday in a tepid welcome to a compromise 789 billion dollar stimulus plan for the US economy as the market steadied after disappointment over a government bank rescue plan.
In Europe, investors digested a batch of earnings from major players.
The share price of Diageo (LSE: DGE.L - news) tumbled 5.23 percent to 860 pence after the world's biggest maker of alcoholic drinks revised lower its profits forecast for 2008/09 owing to the economic slowdown.
The maker of Guinness, Baileys liquor and Smirnoff vodka said operating profit in the year to June would increase by 4-6 percent instead of 7-9 percent forecast previously.
Diageo's revision downwards came as it also said that group net profit had risen 16.6 percent to 1.137 billion pounds (1.265 billion euros, 1.635 billion dollars) in the six months to December, although the second quarter was sour.
In Paris meanwhile, energy group Total jumped 1.46 percent to 40.67 euros after France's biggest firm announced the highest annual net profit in French corporate history.
In 2008 the firm enjoyed net profit of 13.9 billion euros (18.0 billion dollars) thanks to record oil prices in the first half of the year, which generated big enough revenues to overshadow a post credit crunch collapse in demand.
French automaker Renault (Paris: FR0000131906 - news) gained 3.88 percent to 16.87 euros despite revealing an operating loss in 2008. The group said it would focus on freeing up cash this year to weather even worse market conditions ahead.
On Thursday, Japan dived more than three percent following a domestic public holiday during which the region's stock markets dropped on disappointment over the Obama administration's plans to save the financial sector.
Hong Kong was 2.3 percent off, dragged down by the Nikkei (news) and fears over corporate earnings, while Singapore lost 2.15 percent and Taipei 2.39 percent.
However, Sydney ended 1.2 percent higher.
Investors remained apprehensive for a second day on Thursday after the US Treasury's action plan to save the banking sector failed to provide any details.
News that a massive new economic stimulus plan was on the verge of being passed in Washington failed to lift spirits.
On Wednesday in New York, the Dow Jones Industrial Average added 0.64 percent to finish at 7,939.53 points, coming off a hefty 381-point slide Tuesday that sent the blue-chip index to a nearly three-month low.
The Nasdaq climbed 0.38 percent to 1,530.50 points and the broad-market Standard & Poor's 500 index increased 0.80 percent to 833.74.
The market regained its footing after a rout on Tuesday when Treasury Secretary Timothy Geithner failed to offer details on a much-anticipated rescue for the ailing financial sector.
Some analysts said traders may be looking a bit more calmly at the situation after Tuesday's panic.
During the session, US lawmakers struck agreement on a compromise 789 billion dollar stimulus plan, and prepared to vote as early as Thursday to send the package to President Barack Obama.
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