Europe Starts Lower

Ivaylo
16 May, 2006
Frankfurt

Volatility prevailed on the market, as London FTSE 100 dropped 0.5 %, along with the CAC in Paris, down 0.3% and Frankfurt

[R]6:30 AM Europe down on commodity pressures.[/R]
European markets were lower by mid morning on Tuesday, reversing earlier advances, as investors were came under pressure by commodity stocks to sell oil, mining and metal shares. Austria’s OMV was the biggest loser, as it stock lost 8.5%, accompanied by another company in the red, Norway’s Statoil, down 0.8%. Luxury goods stocks also sank on consumer sentiment over energy costs. French perfume maker, Hermes International, was off 4.1% and the Swiss watchmaker, Richemont, dropped 2.1%. EADS, producer of Airbus, reported strong earnings, up 26%, beating analyst expectations despite a strong euro, hampering export.

Oil continued its fall on Tuesday morning on worries that high energy costs may slow down economic growth. Crude oil was traded 14 cents lower at $69.27 a barrel by 0719 GMT, London Brent fell 25 cents to $69.42. Gold in London was fixed at a recommended price of $681.00, down from $683.60 late Monday on NYME. The dollar was down against the euro. The euro bought $1.2807, down from $1.2809 late Monday in New York, the greenback was slightly up against the yen, buying 110.30 yen, up from 110.20 yen on Monday, and off from the British pound. One British pound was traded at $1.8803, up from $1.8793.

[R]5:00AM Gold sheds nearly 4%. Other metals follow suit.[/R]
June gold declined $27.10 to finish at $691.90 an ounce on the NYME after dipping to $685 an ounce earlier in the day, its lowest level since it soared above $700 last week. As high as the record-breaking 29,513 contracts for gold contracts were witnessed Monday. Other metals also declined on Monday. Silver dropped 90 cents to close at $13.335 an ounce; July platinum dropped $33.70 to end at $1,284.80 an ounce; and June palladium dropped $23.60 to close at $374.75 an ounce. Copper shed 11.75 cents to finish at $3.7465 per pound.

Crude oil was also down $2.63 to $69.41 a barrel while gasoline declined 12.45 cents to $2.0540 a gallon. Arabica coffee sank to five-month lows, edging down 2 cents to settle at $1.0160 a pound. Raw sugar in foreign ports lost 0.43 cent to close at 17.17 cents a pound.