Euro hits two-week low against dollar amid hope of ECB rate cut
EUROPEAN stocks fell yesterday as Royal Bank of Scotland slid after predicting a loss and investors weighed up manufacturing data from the US.
The euro fell to a two-week low against the dollar, extending losses to a fifth day, as slowing eurozone inflation raised expectations of a European Central Bank rate cut by the end of the year.
At home, the ISEQ Overall Index ended the week down 0.31pc to 4392.43.
Bank of Ireland was among the laggards on the Dublin market after a strong performance on Thursday. The lender said yesterday that the levy imposed on banks in the Budget would cost it €40m a year. But it said it was able, and willing, to lend. The bank closed down 5.2pc to 26 cents.
Packaging giant Smurfit Kappa fell 0.2pc to €17.86 as stockbrokers Davy projected Q3 results were likely to show further growth in underlying profitability.
Drinks giant C&C fell 0.4pc to €4.30, while food ingredients giant Kerry Group was down 0.2pc to €47.06.
On the other side of the board, Aer Lingus increased 2.4pc to €1.43 and drug company Elan was up 1.9pc to €12.44.
Insulation group Kingspan increased 2.3pc to €12.60.
In Europe, the Stoxx 600 lost 0.3pc to 321.5 points. The gauge climbed 0.4pc this week, closing on Thursday at its highest level since May 2008.
National benchmark indexes fell in 11 of the 16 western European markets open yesterday.
The UK's FTSE 100 added less than 0.1pc. Germany's DAX lost 0.3pc. France's CAC 40 slid 0.6pc. Stock markets in Austria and Luxembourg were closed, with Sweden open for only half-a-day, for All Saints Day.
Royal Bank of Scotland slid 7.5pc after predicting a "substantial" annual loss because of writedowns.
Carmaker Renault declined 5pc after its partner Nissan cut its full-year profit forecast.
Vodafone Group rose to the highest price in 12-and-a-half years after it was suggested that US giant AT&T is exploring a takeover of the company.
In the US, the dollar rose for a sixth day and Treasuries slumped as faster-than-forecast growth in manufacturing fuelled speculation that the Federal Reserve will taper stimulus.
Fed policy-makers said this week that the economy showed signs of "underlying strength", even as they maintained their $85bn (€63bn) of monthly asset purchases. (Additional reporting Bloomberg)