European Markets in Broad Decline of 1.5%

Nigel Thomas
29 May, 2013
New York City

European markets accelerated the decline in early afternoon from the 10% surge in six weeks on the uncertainty surround when the Fed plans to trim buying. Market indexes across the region fell as much as 1.8% and the euro weakened.

[R]3:00 PM Frankfurt – European markets accelerated the decline in early afternoon from the 10% surge in six weeks on the uncertainty surround when the Fed plans to trim buying. Market indexes across the region fell as much as 1.8% and the euro weakened.[/R]

European markets declined more than 1% on the rising worries that the central banks in the U.S. and Asia may unwind the stimulus despite the reassurances earlier in the week.

FTSE 100 index dropped 1.5% to 6,660.18 and CAC 40 index declined 1.4% to 3,996.10.

Market indexes in Frankfurt declined 1.6% to 8,344.70 and the indexes in Madrid declined 0.6% and in Zurich fell 1.8%.

Market indexes pulled back after rising 10% since mid-April.

German unemployment in May increased 21,000 to 2.96 million and seasonally adjusted jobless rate was unchanged at 6.9%.

The increase in number of unemployed persons was sharply higher than estimated 5,000 by many economists on longer than expected winter and weak economic backdrop in Southern Europe.

The International Monetary Fund lowered its estimate of China’s growth to 7.75% in the current year from its earlier forecast of 8% in April.

Stocks in Review

De La Rue Plc declined 2% after the maker of cash handling equipment said full-yen ending in March revenues decreased to 484 million pounds, below analyst estimate of at least 500 million pounds.

Evraz decreased 1.8% after the commodities producer is scheduled to be removed from the widely followed Stoxx 600 index by the end of trading on June 21.

H&M declined 2% after Goldman Sachs analyst recommended investors to sell the stock and said profitability in the second quarter will decline as customers look for more products online.

PSA Peugeot Citroen fell 2.4% after a report in La Tribune suggested that the company is looking to raise capital and the Peugeot family and the company has discussed the amount of shareholding dilution. However, the company spokesman said that capital increase is not the goal in the near term.

Salmar ASA increased 1.2% after the Norwegian salmon producer said sales increased to 1.28 billion kroner in the first quarter.