Security Jitters Weigh On Europe

Ivaylo
10 Aug, 2006
Frankfurt

Britain lifted its security threat level which means it anticipates an attack imminently. Strength in the euro and a late sell-off on U.S. markets as the price of oil climbed also weighed on European stocks. The FTSE 100 in London dipped 1.4%, the Xetra Dax sank 2.1% and the CAC-40 fell 1.5%.

[R]6:15AM European stocks fell Thursday morning on security issues.[/R]
European markets were lower Thursday morning. The FTSE 100 in London dipped 1.4% to 5,781.2, the Xetra Dax sank 2.1% to 5,585.72, the CAC-40 fell 1.5% to 4,952.28. British Airways shed 4%, Ryanair dropped 3.3% and Lufthansa fell 3.8% on security uncertainty and the impact on travel sentiment as UK airports have introduced a ban on all hand baggage on aircraft leaving the UK, on government advice. Ferrovial, owner of UK airports operator BAA, declined 3%.

Tui, the German tourism and shipping group, sank 6.5 per cent to ˆ14.54 as it warned costs at its shipping division would hit this year’s earnings. Securitas, the security services group, fell 9.7 per cent to SKr120.50 after reporting second quarter earnings fell well below forecasts. Deutsche Telekom lost 8.2% after Europe’s biggest telecom group issued a profits warning and reduced its targets for 2006 and 2007. The telecom sector suffered a blow, falling 3.3 %, with Telecom Italia down 2.8%, France Telecom off 3.1% and BT down 2.6%.

Crude oil prices changed little Thursday as the market remained wary of factors influencing supply in the United States, Africa and the Middle East. Light, sweet crude for September delivery gained 9 cents to $76.44 a barrel in electronic trading on the NYME. September Brent crude futures on London''s ICE Futures rose 25 cents to $77.53 a barrel. Gold opened Thursday at a bid price of $653.10 a troy ounce, up from $652.90 late Wednesday.

The euro gained slightly against the U.S. dollar Thursday as traders absorbed a decision by the U.S. Fed to hold off on any interest rate increases. The euro bought $1.2889 in morning European trading, up from $1.2861 in New York late Wednesday. The British pound edged upward to $1.9074 from $1.9049. The dollar was marginally lower against the Japanese currency, slipping to 115.06 yen from 115.23 yen

[R]5:00AM Copper prices reached four-week high on labor strike.[/R]
The most-traded September copper ended up 10.80 cents at $3.71 per pound. December gold advanced $4.70 to settle at $662 a troy ounce. September silver settled up 31 cents at $12.57 an ounce. October platinum closed up $7.00 at $1,263 an ounce and September palladium settled up $2.95 at $326.70 an ounce.

The September crude oil contract finished up 4 cents at $76.35 a barrel. September gasoline moved down 5.41 cents to $2.1722 a gallon. September heating oil edged down 1.01 cents to $2.1063 a gallon. September natural gas closed up 49.3 cents at $7.651 a million British thermal units. On the New York Board of Trade, September Arabica coffee rose 0.55 cent to $1.0765 a pound. October futures on raw sugar in foreign ports gained 0.05 cent to 14.04 cents a pound.