Negative US jobs data shaves values

US STOCKS fell sharply after poor employment data heightened the impression the economy is stuck in slow-growth rut. The news added to evidence that Europe’s debt crisis is weighing on global growth.

European shares posted their worst one-day fall in around two weeks.

The FTSE 100 Index lost 30 points, or 0.5 per cent, to 5,662.63 at the close in London. The gauge has still added 1.7 per cent this week, its biggest weekly gain since the beginning of June. In Dublin the Iseq Index slipped 1.6 per cent.

DUBLIN

THE IRISH market, though down about 1.6 per cent, slightly outperformed the rest of Europe, which was off about 2 per cent across the board.

Building materials giant CRH was 4.2 per cent weaker, with one trader attributing the fall to the deterioration right across Europe in markets wary of an ongoing lack of certainty. In a drop in line with its peers, the stock closed down 60 cent at €14.57.

As interest rates in Europe fell, squeezing bank margins even further, Bank of Ireland slipped 3.03 per cent closing at €0.09.

Ryanair finished the day at €4.04, four cent or 1.2 per cent lower. One trader attributed this to poor data from Spain, a country which accounts for 25 per cent of the airline’s passenger numbers, where domestic travel is down 30 per cent.

Kerry bucked the trend on the wider market, performing strongly to finish up by almost 3 per cent. The food stock closed up €1.02 at €35.57.

Oil exploration company Providence also advanced in yesterdays session, finishing 8.21 per cent or 55 cent ahead at €7.25 on speculation of high oil estimates off the Cork coast.

Independent News & Media was 7.44 per cent firmer, albeit in light volumes, at €0.23.

LONDON

VALUES DECLINED from a two-month high on jitters over the US jobs data, with the UK’s FTSE 100 shedding 0.5 per cent of its value.

Rio Tinto, the world’s third-biggest commodity producer, lost 1.8 per cent to 3,098.5 pence amid a general sector retreat.

Insurer Aviva rose 2.7 per cent after selling more shares in Delta Lloyd than previously planned.

Marks Spencer slipped 3.2 per cent to 318.6 pence after the Financial Times said the retailer will report its worst quarterly trading in three years.

Premier Foods gained 1.1 per cent to 89.3 pence after Associated British Foods agreed to buy some of its brands, including Elephant Atta flour, for £34 million in cash.

EUROPE

STOCKS EXTENDED losses for a third day, with US data again the main driver.

National benchmark indexes fell in 16 of the 18 western European markets. Germany’s DAX and Frances CAC-40 each retreated 1.9 per cent.

Peugeot, Europe’s second-largest carmaker, slid 7.7 per cent to €7.08. The company said first-half sales declined to 1.62 million trucks from 1.86 million a year earlier as demand slumped in European markets.

BMW, the biggest maker of luxury cars, fell 4.6 per cent to €56.42 after Morgan Stanley downgraded the stock to equal weight, the equivalent of hold, from overweight.

Daimler was 3.3 per cent weaker at €35.34 while Fiat fell 5.3 per cent to €4.05.

BBVA tumbled 5.1 per cent to €5.18 after HSBC downgraded the stock to neutral from overweight, meaning investors should not buy more of the shares.

Fellow Spanish bank Banco Popular Espanol slid 4.1 per cent to €1.63, dropping for a fifth day.

Among technology stocks, Software and SAP slid 5.7 per cent to €23.51 and 4.4 per cent to €45.55, respectively.

Deutsche Lufthansa was 0.8 per cent stronger at €9.27 while Arkema, a French maker of industrial chemicals, surged 11 per cent to €59.28.

NEW YORK

US EMPLOYERS hired at a dismal pace in June, raising pressure on the Federal Reserve to do more to boost the economy and dealing another setback to President Barack Obama’s re-election bid

The Labor Department said non-farm payrolls rose by just 80,000 jobs in June, falling short of forecasts and barely changed from May’s revised reading of 77,000. Stocks fell, halting a three-day advance for the SP 500.

Alcoa, the largest US aluminium producer, tumbled 3.1 per cent to $8.64 while energy producer Chevron slid 1.2 per cent to $104.73. JPMorgan slipped 1.4 per cent to $33.90 while Bank of America lost 1.5 per cent to $7.70.

Technology shares dropped the most among SP 500 groups. Seagate fell 3.2 per cent to $24.27. Citrix Systems slumped 8.7 per cent to $76.47. Airlines advanced on expectations that fuel costs will fall. Southwest Airlines gained 0.7 per cent to $9.21 while Delta Air Lines rose 1.4 per cent to $10.78. – (Additional Reporting: Reuters, Bloomberg)