European markets retreat for the first time in three weeks


Sun, May 08, 2011 - Page 10

European stocks retreated for the first week in three as energy and mining companies tumbled with commodities, overshadowing a bigger-than-forecast increase in US payrolls.

Fresnillo PLC, the world’s biggest primary silver producer, slumped 12 percent as the precious metal had the largest weekly drop in more than 30 years. Royal Dutch Shell PLC, Europe’s largest oil company, sank 4.2 percent as crude suffered its biggest weekly retreat in a year. Lloyds Banking Group PLC plunged 8.9 percent after reporting a loss.

The STOXX Europe 600 dropped 0.9 percent to 281.33 this week, paring this year’s advance to 2 percent. The measure closed at a two-month high on Monday, as US President Barack Obama said US forces killed al-Qaeda leader Osama bin Laden, before sliding 2.2 percent over the following three days.

“A fall in commodities and oil prices has knocked the stuffing out of basic-resources and energy stocks,” said Dale Gibson, head of European equities at Raymond James in London. “Europe hasn’t had any genuine private-sector job growth in a long time, showing a remarkable contrast with this week’s payrolls data in the US”

The STOXX 600 has still climbed 7.3 percent from this year’s low on March 16.