Fall in euro-area GDP hits shares
Published 15/02/2013 | 04:00
IRISH shares were little changed yesterday amid gloomy news that the major European economies shrank at the end of last year.
By the close in Dublin, the ISEQ Overall Index dipped slightly by 0.05pc, or 1.92 points, to finish the session at 3,680.64.
The Dublin market rose on opening before falling steeply, and recovering just gradually through the day.
But the rise wasn't enough to pull it out of the red.
The economic news from Europe did little to boost confidence, with euro-area GDP falling 0.6pc in the final three months of last year. The German economy shrank 0.6pc, French GDP fell 0.3pc and Italy's economy shrank 0.9pc.
The laggards in the Dublin market included Aer Lingus, which fell 2.4pc to close at €1.24, and building materials group Grafton, which dropped 1.1pc to €4.72.
Packaging giant Smurfit Kappa was down 2.4pc to €11.23, while Abbey slipped 2pc to end the trading day at €7.50.
On the other side of the board, the leaders included bookmakers Paddy Power who jumped 1.5pc to €63.24, while agri-business Origin Enterprise was up 2.1pc to €4.95.
Drug firm Elan was up 2.5pc to €7.71 after reports that directors' pay fell by over $700,000 (€520,000) last year, with chief executive Kelly Martin taking a 24pc pay cut.
Elsewhere, most European stocks also declined in the midst of the economic news.
The Stoxx Europe 600 Index retreated 0.2pc at the close, paring an earlier drop of as much as 0.6pc, as releases showed the three big European economies all contracted more than estimated.
National benchmark indexes fell in 13 of the 18 western European markets.
Germany's DAX dropped 1.1pc, while the UK's FTSE 100 slid 0.5pc and France's CAC 40 retreated 0.8pc.
"The weaker German data is weighing on shares," Guillermo Hernandez, who helps manage about $664m as head of trading at FPM Frankfurt Performance Management said.
"Germany is supposed to be the European locomotive. It is not catastrophic yet, but it leaves investors more cautious."
Nestle, the world's largest food company, fell the most since April after reporting the slowest sales growth in three years.
Car companies Renault and ABB jumped at least 5.5pc after reporting earnings that beat estimates.
Alternative investment management company Man Group rose for an eighth day, its longest streak of gains in 12 years.
Bankia, the lender recently ejected from Spain's benchmark IBEX 35 Index, slumped 12pc.