Persistent worries about the state of the economic recovery globally and the debt crisis in parts of Europe sent European equities markets lower Friday.
In London, where the FTSE 100 was down 1.55 percent to 5,765.8 and the FTSE 250 dropped 1.05 percent to 11,786, all constituents in the banking, mining, health care and utilities sector were lower on the session, and the chemicals and energy sectors, food & beverages and the media sector each saw just one gainer.
Four out of the five top gainers on the 100 were the only gainer in their respective sectors, with Essar Energy (LSE: ESSR) leading gains on the 100 as it added 1.6 percent, while Associated British Foods (LSE: ABF) was up 1.43 percent, chemicals group Johnson Matthey (LSE: JMAT) was 0.71 percent higher, and publisher Pearson (LSE: PSON) gained 0.6 percent.
On the other hand, homebuilder Redrow (LSE: RDW) added 3.16 percent to lead gains on the 250 and in a homebuilding sector that bucked the day’s trends to see gains, including a 2.73 percent advance for Bellway (LSE: BWY), which was up on greater demand in and near London.
Eurasian Natural Resources (LSE: ENRC) was the biggest decliner in the mining sector and on the 100 on a report that it is losing another director, the third in a week, as one independent director resigned after two others were not rehired, while platinum miner Lonmin (LSE: LMI) followed ENRC lower on the 100 as it dropped 5.44 percent on a reduced sales outlook for the year ending 30 September and after UBS began coverage with a “sell” recommendation.
JD Sports Fashion (LSE: JD), down 7.88 percent, was the worst performer on the 250 and in the retail sector, which had two other constituents in the list of biggest losers on that index as furniture retailer and manufacturer Dunelm Group (LSE: DNLM) dropped 7.57 percent and car parts retailer Halfords Group (LSE: HFD) was 5.27 percent lower, while there were only two gainers in the retail sector with the best performer, consumer electronics retailer Dixons Retail (LSE: DXNS), adding just 0.17 percent.
Home Retail Group (LSE: HOME) was down again, dropping 5.16 percent after yesterday’s disappointing report on sales at its Argos catalog stores.
The telecommunications sector had only two gainers, while there were three gains in the insurance and travel and leisure sectors, and just four advances in the financial services sector.
The FTSE Eurofirst 300 was down 1.27 percent to 1,090.44 while the Dax fell 1.25 percent with just one gainer and a chipmaker leading declines, the IBEX was 1.69 percent lower to 9,950.8 and the CAC-40 dropped 1.9 percent to 3,805.09 with only one gainer and a telecommunications group as the worst performer.
Most markets in Asia and the Pacific region were lower Friday on continuing concerns that central banks in the region will raise interest rates to try to keep inflation under control after South Korea’s central bank hiked rates, the third time this year that it has done so, and analysts expect another rate hike from the People’s Bank of China sometime this month.
Japan’s markets were mostly higher, however, helped by separate reports from the United States showing that the US trade deficit narrowed unexpectedly in April, while US consumer confidence was up at the beginning of June, although it remained in negative territory, with the biggest improvement among consumers making less than $50,000 per year.
The Nikkei 225 added 0.5 percent to 9.514.44 and the Topix index was up 0.54 percent to 817.38, but the Mothers market dropped 0.94 percent to 459.64 as the oil sector saw gains on higher oil prices and carmakers were up ahead of Tokyo’s outlook for the current fiscal year.
Kawasaki Heavy Industries Ltd (TYO: 7012) was 4.3 percent higher after Bank of America Merrill Lynch raised its recommendation on the maker of aircraft, locomotives, ships and other heavy equipment from “neutral” to “buy”.
The Shanghai Composite was also higher, adding 0.07 percent to 2,705.14 in China, and Australia’s markets were up as the S&P/ASX200 was up 0.27 percent to 4,562.1 and the Sydney Ordinaries gained 0.29 percent to 4,634.9, but other markets were lower as the Straits Times Index dropped 0.62 percent to 3,078.35 in Singapore, India’s Sensex was down 0.63 percent to 18,268.5, the Hang Seng fell 0.84 percent to 22,420.4 in Hong Kong, South Korea’s Kospi was 1.19 percent lower to 2,046.67 and the Taiex was down 1.81 percent to 8,837.82 in Taiwan.
New York equities markets were lower, with the Dow Jones Industrial Average down 1.15 percent to 11,984.9 at just past 1 p.m. local time, while the S&P 500 had dropped 1.21 percent to 1,273.43 and the Nasdaq Composite was 1.18 percent lower to 2,653.22.
Crude oil prices dropped in New York and London as Saudi Arabia unilaterally raised its oil production, announcing Friday that it will raise output to 10 million barrels per day from July, up from 9.3 million barrels per day, after the Organization of Petroleum Exporting Countries decided Wednesday to hold production quotas steady.
July contracts for West Texas Intermediate crude had dropped $2.52 to $99.41 per barrel at just before 1 p.m. on the New York Mercantile Exchange, while the latest report on Brent crude was that it was down $1.13 to $118.44 per barrel on the ICE Futures Europe exchange in London.
Metals prices were lower in New York.