Sun, Feb 18, 2007 - Page 5 News List

Oil, US housing market weigh on European stocks


European stock exchanges wilted on Friday, dragged down by sliding oil prices and weak US housing market data.

The London FTSE 100 index fell 0.21 percent to close at 6,419.50 points, while in Paris the CAC 40 slipped 0.13 percent to finish at 5,713.59. The Frankfurt DAX shed 0.02 percent to reach 6,957.07.

The EuroStoxx 50 index of leading eurozone shares gave up 0.25 percent to end the week at 4,247.40.

On the currency market the dollar was little changed against the euro but was under pressure following the release of economic data in the US that presaged no imminent increase in US interest rates.

The single European currency in late-day trading was at US$1.3137 after US$1.3139 late on Thursday in New York.

Wall Street shares swung lower after the government reported that US housing starts plunged to their lowest level in nearly a decade last month.

The blue-chip Dow Jones Industrial Average, which closed at a record high on Thursday, dipped 0.10 percent to 12,751.87 at 4:55pm.

The tech-laden NASDAQ composite was down 0.29 percent to 2,489.97.

Shares weakened after the Commerce Department said housing starts slid 14.3 percent last month to a seasonally adjusted 1.408 million units.

The steeper-than-expected slump in housing activity saw starts fall to their lowest level since August 1997.

Most Wall Street analysts had expected housing starts to decline, but only to around 1.6 million units.

Some analysts played down the sharp slump in housing starts.

"The decline is exaggerated, however, and not too much emphasis should be placed on it. January was a cold month after a warm December," said Dick Green, an analyst at

In London, oil shares were depressed by crude prices that fell throughout much of the day before turning stronger near the end of trading.

BP shed 0.37 percent to £5.35 while Royal Dutch Shell lost 0.88 percent to finish at £16.85.

Supermarket chain Sainsbury gave up 0.88 percent to finish at £3.12 on a report in the Times that investment fund Cinven had abandoned plans for a takeover.

In Paris, steel giant Arcelor Mittal rose 1.45 percent to 38.54 euros (US$50.63), buoyed by a rise in prices for some products that was welcomed by investors.

Construction group Bouygues fell 1.36 percent to 54.20 euros after HSBC lowered its recommendation on the company.

In Frankfurt, tourism operator TUI lost 0.16 percent to 18.64 euros on profit-taking that set in after gains stretching over several weeks.

Elsewhere there were declines of 0.33 percent to 506.10 points on the AEX in Amsterdam, 0.19 percent to 14,876.9 on the IBEX-35 in Madrid and 0.26 percent to 4,532.75 on the BEL 20 in Brussels.

There were gains of 0.33 percent to a record 9,305.39 on the Swiss Market Index and 0.01 percent to 42,879 on the SP/MIB in Milan.

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