European shares move lower on euro gains and Fed
Irish and European stocks slid for a second day yesterday, extending declines as the euro strengthened and in the US Federal Reserve Chair Janet Yellen said equity market valuations are high.
The ISEQ index of Irish shares was down 78.48 points at 6024.99 heading into the close. The Stoxx Europe 600 Index slid 0.5pc to 388.95 by 3.50pm in London yesterday, having swung between losses of 1pc and gains of 0.3pc.
US equities fell as much as 0.6pc after Ms Yellen's remarks before paring the drop, while the dollar weakened against the euro.
An earlier report showing US companies added fewer-than-forecast employees in April also helped send stocks lower.
In Dublin, baking giant Aryzta was down 1.17pc to €59.18 a share, Smurfit Kappa fell just over 1pc to €26.58 a share.
Of the risers, Paddy Power was up three quarters of a percent at €78.74 a share, the strongest in a muted field of positive movers.
Elsewhere the Swiss Market Index plunged 1.5pc for the worst performer among western-European markets. The U.K.'s FTSE 100 Index was little changed, paring an earlier advance, before the general election today, with polls showing no clear winner.
Healthcare shares were the biggest drag on the Stoxx 600, with Novartis and Roche Holding declining at least 1.7pc. A recovering euro put pressure on some stocks.
"Consolidation will continue," saud Guillermo Hernandez Sampere, who helps manage about €150m at MPPM EK in Eppstein, Germany.
"A lot of fast money was invested in a falling euro and now they have to unwind positions.
"And you get liquidity by selling stocks. Anything that the Fed chair says you need to read between the lines.
"The Fed knows that if it raises the rates too soon it would hurt the economy and the valuations of stock markets," he said.
Investors are also watching developments in Greek debt talks. European Central Bank officials will discuss whether to raise discounts on the collateral Greek banks pledge in exchange for emergency funding, two people familiar with the matter said.
Tumbling Greek shares led European stocks to their lowest level in two months on Tuesday on concern that bailout negotiations will fail to secure funding in time to prevent the nation defaulting. The ASE Index added 2.9pc yesterday, after earlier losing as much as 1.8pc.
Among stocks moving after corporate earnings, Societe Generale SA fell 2.9pc as it posted declining revenue from trading bonds and a loss in Russia.
Sainsbury slipped 3.9pc as the UK grocer reported lower profits.