Sun, Nov 19, 2006 - Page 10 News List

Blue-chips drop in Europe, weighed by mining, energy


European blue-chips fell sharply on Friday on fears of an economic slowdown in the US and a slump in heavyweight mining and oil stocks, dealers said.

In London, the FTSE 100 index dropped 1.01 percent to 6,192 points. In Paris, the CAC 40 gave up 1.20 percent to 5,439.71, while Frankfurt's DAX 30 index closed 0.42 percent lower at to 6,416.04 points.

The DJ Euro STOXX 50 index of leading eurozone shares decreased by 0.77 percent to 4,078.36 points.

In recent weeks, investor sentiment had been bolstered by record US trading and healthy corporate results, resulting in some bumper gains across equity markets in Frankfurt, Paris and London.

As European markets closed on Friday, the Dow Jones Industrial Average was off by a slight 0.05 percent at 12,299.73 points in New York and the tech-heavy NASDAQ Composite was down by 0.57 percent at 2,435.19.

The broad Standard & Poor's 500 index had given up 0.21 percent to 1,396.83 points.

US equities were undermined by government data which showed that housing starts fell much more heavily than expected last month, casting a shadow on a key pillar of the economy.

Wall Street had roared to fresh highs on Thursday after a tame report on inflation sparked hopes that the US Federal Reserve would soon start cutting instead of hiking interest rates.

Meanwhile, Japanese share prices fell on profit-taking on Friday, hovering just above the 16,000-point mark amid lingering concerns about the outlook for the economy, dealers said.

In Europe, energy shares suffered from falling oil prices, with the price of crude dropping in New York to a level last seen in June last year on concern over the full implementation of a recent cut in OPEC oil output.

Shares in the French oil and gas group Total slumped 2.16 percent to 54.45 euros in Paris, while Eni stock fell 1.59 percent to 24.69 euros in Milan.

Mining stocks were in for some free-falls of their own as prices for gold, platinum and zinc plummeted.

Xstrata shed 4.82 percent to £21.54, Antofagasta gave up 4.54 percent to £4.5775 and Rio Tinto dropped 4.13 percent to £26.69.

In Amsterdam, the AEX index fell by 0.68 percent to 492.62 points, the Swiss SMI was down by 0.50 percent to 8,745.82, in Milan the SP/MIB slipped by 0.41 percent to 40,649, in Madrid the IBEX-35 shed 0.50 percent to 14,170 and in Brussels the BEL-20 closed 1.0 percent lower at 4,223.19 points.

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