European stocks scrape back losses on upbeat US data
Monday, April 14, 2014
European stock markets recovered early losses on Monday as upbeat US retail sales data helped investors shake off off concerns over the Ukraine crisis, which weighed on Russian shares and the ruble.
Wall Street opened higher after government data showed retail sales surged 1.1 percent in March as consumers ramped up spending following brutally cold weather earlier in the winter.
The news helped to boost sentiment in Europe, where markets took a bruising in early trade after Ukraine declared a "full-scale" military operation against pro-Russia forces, amid deadly clashes in its restive east.
London's benchmark FTSE 100 index was down 0.4 percent at 6,559.24, recovering after dipping 0.82 percent earlier in the day.
Frankfurt's DAX 30 fell 0.26 percent to 9,290.65 points, while in Paris the CAC 40 index dipped 0.06 percent to 4,363.29, compared with Friday's closing levels.
US markets also received a boost from better-than-expected results from banking giant Citigroup, which reported profits excluding special items of $1.23 per share, above the analyst estimate of $1.14 per share.
About 30 minutes into trade, the Dow Jones Industrial Average had advanced 0.39 percent to 16,089.56.
The broad-based S&P 500 rose 0.44 percent to 1,823.73, while the tech-rich Nasdaq Composite Index added 0.32 percent to 4,012.51.
Russian shares and the ruble, however, were still weighed down by concerns over clashes between pro-Russia forces and the Kiev authorities in eastern Ukraine.
The move prompted the UN Security Council to hold emergency talks on Sunday.
In reaction, Moscow's benchmark MICEX stocks index, which is denominated in rubles, fell 1.46 percent and the RTS, which is denominated in dollars, sank 2.21 percent.
The Russian currency slid both against the euro, which climbed 0.61 percent to 49.7165 rubles, and against the dollar which rallied 0.71 percent to 35.9575 rubles.
"The ruble is down as the Ukraine crisis comes back to the front burner, as US/Russia clash at the UN and Ukraine says it will protect its territory with force," Forex.com research director Kathleen Brooks told AFP.
"This crisis has been escalating for months, yet the markets only seem to concentrate on its sporadically."
She added: "The market could be concentrating on Ukraine once again since volumes are low, it's Easter week and nothing much else is going on."
NATO and Western powers have called for Russia to de-escalate the situation but Moscow denies playing a role in the violence and says Ukraine is waging war against its own people.
The price of haven investment gold jumped to a two-and-a-half-week peak at $1,330.59 an ounce as investors sought shelter from the Ukraine crisis.
Asian equities mostly fell on Monday following a heavy pre-weekend sell-off on Wall Street and renewed concerns over the crisis in Ukraine.
Tokyo slid 0.36 percent and Sydney shed 1.28 percent, while Hong Kong eked out a slender gain of 0.15 percent.
In company news, French carmaker Peugeot saw its share price slide 4.09 percent to 13.12 euros as investors were disappointed by the group's newly-unveiled recovery strategy.
Peer Renault was also pushed lower, diving 4.96 percent to 69.33 euros.
Dealers meanwhile digested comments from the head of the French central bank Christian Noyer a member of the ECB policy council, that the single currency was "abnormally strong".
In late morning foreign exchange deals in London, the euro drifted down to $1.3824 from $1.3883 late in New York on Friday.
The single currency dipped to 82.66 British pence from 82.98 pence on Friday, while the pound eased to $1.6722 from $1.6729.
On the London Bullion Market, gold prices later stood at $1,322.92 an ounce, up from $1,318 on Friday.
Copyright © 2014 AFP