European markets prolong decline

Data detailing unexpected falls in production levels across the eurozone’s services and manufacturing sectors in February pulled European markets down for a second consecutive day yesterday.

The majority of benchmark indexes in the eurozone were down. Spain’s IBEX fell 1.26% and Germany’s DAX declined by just under 1%.

In Paris, the CAC-40 was down by 0.5%, even though France Telecom shares rose after it said it was cutting dividend payments in a bid to safeguard cash. In London, the FTSE fell 0.2%.

In Dublin, there were decent gains across a number of sectors, with recruitment specialist CPL up by over 3% and Icon, Grafton Group and FBD also rising by between 1% and 2%. Another mixed day for exploration stocks saw Tullow falling by 1.3% and Petroceltic unmoved, but both Providence Resources and Petroneft recovering previous losses.

However, overall the ISEQ fell by 0.5%, following a 0.7% fall on Tuesday, as there were solid percentage falls for the likes of Bank of Ireland, Independent News & Media, Ryanair, Origin Enterprises, Kenmare Resources, Irish Life & Permanent and C&C.

“Given that Europe is still shrouded by the cloud of recession, a weak PMI [purchasing managers’ index] — though not rain on the parade — will surely damp investor sentiment,” the Bloomberg news service quoted London-based investment banker, Manish Singh as saying. “In particular, weak numbers from Germany indicate weak European demand and a weak growth prospect for the eurozone as a whole.”

In Asia, marginal percentage growth was evident in Tokyo and Hong Kong. In the US, however, early trading resulted in slight falls on Wall Street, as investors reacted negatively to the latest eurozone data.