Thursday 27 April 2017

Credit Suisse miss drags Europe lower

The logo of Swiss bank Credit Suisse is seen in front of a branch in Riehen, Switzerland. Photo: Reuters
The logo of Swiss bank Credit Suisse is seen in front of a branch in Riehen, Switzerland. Photo: Reuters

Danilo Masoni

European shares fell yesterday as weak US data fed concerns that the world's biggest economy may be slowing down, with export-oriented auto stocks leading the decline and Credit Suisse tumbling after reporting a full-year loss.

Losses, however, were limited by a rally in commodities which lifted miners and oil sector stocks.

US non-farm productivity slumped in the fourth quarter and jobless claims rose more than expected, data showed. That put added pressure on the dollar, which has been weakening as expectations for more US interest rate hikes this year fade.

"The dollar is weakening because the market is starting to worry that the strength of the internal labour market may not be enough to contain the headwinds," said Marco Vailati, head of research at Cassa Lombarda. "What's needed are strong data that pour cold water on mounting expectations for a slowdown."

In Dublin the ISEQ index closed down 1.24pc at 6,151. Paddy Power, down 4.49pc at €130.85 a share, Ryanair at €13.70, and Greet Reit at €1.44 a share, were among the decliners.

The pan-European FTSEurofirst 300 index ended down 0.15pc after a choppy day, while the STOXX 600 index fell by 0.2pc to 328.8 points. Swiss bank UBS cut its year-end target for the STOXX 600 by 8pc to 400 points.

Credit Suisse slumped 10.9pc to a 25-year low after posting its first full-year loss since 2008.

Export-oriented auto stocks fell 2.7pc, making them the second biggest sectoral faller. Daimler fell 3.2pc after it predicted modest growth this year after big increases in 2015, blaming China.

Miners and oil and gas stocks surged however, as the decline in the dollar cut commodity prices.

Irish Independent

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