Monday February 16, 10:21 AM
Financials pull European shares down in thin trade
By Peter Starck
FRANKFURT, Feb 16 (Reuters) - European shares fell on Monday in thin trading, led by financial stocks, on persistent concerns that more help for banks and more coordinated economic stimulus packages would be needed to address
the global financial crisis.
Shares in British bank Lloyds were down 5.4 percent, adding to Friday's slide of more than 30 percent on the back of a profit warning that revived concerns it could need more state funds or be nationalised due to deepening problems at HBOS, which Lloyds bought last month.
Also in financials, Deutsche Bank (Xetra: 514000 - news) , Barclays (LSE: BARC.L - news) , ING, BBVA (Madrid: BBVA.MC - news) and AXA (Paris: FR0000120628 - news) were all down between 2 and 2.5 percent.
'The Lloyds story is having a read-across to the rest of the banking sector,' said Richard Hunter, head of equities at Hargreaves Lansdown (LSE: HL.L - news) .
At 0930 GMT, the FTSEurofirst 300 index of top European shares was down 0.5 percent at 792.38 points. It fell 3.6 percent last week.
Falling stocks led risers by a ratio of two to one.
'There's a lot of uncertainty hanging over the markets,' said Heinz-Gerd Sonnenschein, equity strategist at Postbank in Germany.
'Long-term investors are still on the sidelines... There's a very low number of trades and a very low number of market participants,' he said.
On the brighter side, Sonnenschein said he thought there was support for the DJ EuroStoxx50 index of euro zone blue-chip shares at 2,100 points.
The index was down 0.6 percent at 2,214.20 points at 0930 GMT, 5.8 percent above the six-year low of 2,086.09 points set in intraday trading on Jan. 23.
U.S. HOLIDAY
Strategists and traders said European markets lacked clear direction due to a U.S. holiday. Investors seemed disappointed with the lack of specific action points from G7 finance ministers and central bankers, who met at the weekend.
'There was not much reassurance coming out of G7,' said Seven Investment Management director Justin Urquhart Stewart.
Earlier, Asian stock markets fell as doubts intensified about the health of the global economy. With demand for cars and electronics waning, an unprecedented slump in exports saw Japan's economy shrink by 3.3 percent in the fourth quarter, marking three straight quarters of contraction and its worst result since the 1974 oil crisis.
'The crisis has now clearly impacted private consumption and investment activity, too. No improvement is likely short term,' Commerzbank (Xetra: 803200 - news) said in a research note.
There was some rotation into sectors less sensitive to the economic gloom such as pharmaceuticals, with AstraZeneca (LSE: AZN.L - news) up 1.6 percent and Bayer (Xetra: 575200 - news) gaining 1.1 percent.
(Additional reporting by Joanne Frearson in London, editing by Will Waterman) Keywords: MARKETS EUROPE STOCKS/
|
Send Article by Email
Send Article by IM
Blog This with Y! 360
Printable View
