Moody's warning hits markets
It was another market mess yesterday as traders rushed to ditch stocks amid fresh warnings by Moody's that it's to review EU member states' credit ratings.
The agency insisted that last week's summit aimed at finally solving the EU's debilitating debt crisis had failed to deliver "decisive policy measures".
Moody's will complete the country review by the end of the next quarter.
Last week's Brussels summit saw the UK left on the sidelines of a deal that provides the EU with a new fiscal billy club to swiftly bring recalcitrant members into line if they breach specific deficit limits.
All in all, the effort is threatening to be another damp squib, with markets across Europe falling yesterday.
The ISEQ Overall Index followed its peers into negative territory. It see-sawed during the day, erasing some earlier losses by the afternoon, but failed to steady the rout and closed down 1.1pc, or 30.15 points, at 2,711.14.
Among the significant fallers was packaging group Smurfit Kappa. It lost 7.3pc, or nearly 34 cent, to finish at €4.25. The stock has traded below €5 since early September.
Bank of Ireland lost 6.45pc, or 0.6 cent, to end the session at 8.7 cent, while CRH shed 1.1pc to close at €13.35.
Gainers yesterday included pharma group Elan. It added 11.3 cent, or 1.3pc, to finish at €8.68. Agri group Origin Enterprises advanced just over 2pc, or 6.5 cent, to €3.25.
National benchmark indices retreated in all 18 western European markets. France's CAC 40 slid 2.1pc, the UK's FTSE 100 fell 1.5pc and Germany's DAX lost 2.7pc.
The Stoxx 600 earlier pared its decline to as little as 0.3pc after Italy sold €7bn of one- year bills, the maximum for the auction, with a reduced yield. Borrowing costs fell to 5.952 yesterday from 6.087pc at the last sale on November 10 after Prime Minister Mario Monti's government approved a €30bn emergency economic plan.
Axa, Europe's second-biggest insurer, dropped 6.1pc to €10.49. Allianz, the region's largest, declined 6.3pc to €74.42 and Italy's Assicurazioni Generali lost 3.5pc to €12.
S&P placed all three insurers on watch negative after the ratings company started reviewing the credit scores of 15 euro-area governments on December 5.
Royal Bank of Scotland dropped 5.9pc to 20.70 pence after the UK's Financial Services Authority said that the lender was being investigated before its bailout after it wrongly told regulators it held more cash to cover client withdrawals than the required minimum.
Mining giant Xstrata dropped 5.4pc to £9.57, Kazakhmys slid 4.5pc to £8.91 and BHP Billiton slipped 3.4pc to £18.94. Copper fell as much as 2.5pc in London trading as China's exports cooled.