European stocks diverge, miners hit by China concerns

GMT 07:06 2014 Friday ,30 May

Arab Today, arab today European stocks diverge, miners hit by China concerns

A broker works at the Frankfurt stock exchange
London - AFP

European stock markets were mixed on Friday, with many traders away for a long holiday weekend and the mining sector hit by concern about Chinese demand, dealers said. 
London's FTSE 100 index of top companies dipped 0.07 percent to stand at 6,866.56 points in late morning trade, as investors shrugged off positive news on the British economy. 
In Paris, the CAC 40 index fell 0.25 percent to 4,519.41 points, but Frankfurt's DAX 30 rose 0.24 percent to 9,962.83 from Thursday's finish despite sliding German retail sales.
The euro held near the lowest level since mid-February, weighed down by expectations of a cut to eurozone interest rates next week by the European Central Bank (ECB).
Stocks in Europe had edged higher on Thursday in subdued deals because of the Ascension Day holiday in parts of the continent.
"Trading volume remains subdued (Friday) with many traders in countries where markets were closed yesterday having opted to take off and to enjoy an extended weekend," said analyst Markus Huber at broker Peregrine & Black.
"European shares are trading little changed as a strong close in the US last night has been somewhat neutralised by mixed markets across Asia."
- China weighs on miners -
In London, mining companies topped the FTSE fallers board on mounting worries about weaker commodities demand from Asian powerhouse China.
Anglo American shares sank 3.14 percent to 1,496.5 pence, Rio Tinto shed 3.04 percent to 3,091.43 pence and Fresnillo dropped 2.83 percent to 811.36 pence.
BHP Billiton was down 2.09 percent at 1,900 pence, Randgold dipped 1.34 percent to 4,432 pence and Antofagasta lost 1.31 percent to 794 pence.
"Some worrying news from China sent miners lower," said analyst Chris Beauchamp at traders IG.
"Government figures indicated manufacturing growth was weakening, contradicting recent signs of improvement in the economy and providing an excuse for some selling in raw materials."
In Paris, shares in BNP Paribas bank slumped 4.98 percent to 50.03 euros on a report that US justice authorities may fine it more than $10 billion (7.4 billion euros) on charges it broke sanctions against Iran, Sudan and Cuba. 
Trading generally was downbeat as dealers awaited next week's crucial ECB interest rate decision.
The Frankfurt-based central bank has already signalled that it was comfortable with easing monetary conditions, hinting at a possible interest rate cut when it meets next Thursday.
In foreign exchange deals on Friday, the euro stood at $1.3613, up from $1.3601 late in New York on Thursday.
The European single currency eased to 81.34 British pence from 81.36 pence.
The British pound increased to $1.6735 from $1.6716 on Thursday.
The price of gold eased to $1,254.43 an ounce from $1,255 Thursday on the London Bullion Market.
- UK outlook brightens -
The London stock market failed to win a boost from Britain's brightening economic outlook.
Consumer confidence continued to improve in May, reaching the highest level for more than nine years, data showed from research firm GfK.
In another boost, business lobby group the British Chambers of Commerce raised its economic growth forecast for this year to 3.1 percent from 2.8 percent, and its forecast for 2015 to 2.7 percent from 2.5 percent.
Added to the mix, the Confederation of British Industry -- the nation's top employers' organisation -- said its suvey-based measure of economic growth hit the highest level in May since at least 2003.
In Asia, stock markets mostly closed lower on Friday, with Tokyo hit by a stronger yen and data that showed that Japanese household spending tumbling after a sales tax hike.
Tokyo fell 0.34 percent, Seoul slipped 0.86 and Sydney lost 0.49 percent, while Shanghai closed flat but Hong Kong was up 0.31 percent.
- Wall Street boosted by M&A -
Wall Street had risen on Thursday, as takeover activity helped offset news that the world's biggest economy shrank 1.0 percent in the first quarter.
Meat processing company Tyson Foods made a $6.8-billion offer on Thursday for hotdog maker Hillshire Brands, topping a $6.4-billion bid made Tuesday by Pilgrim's Pride, a subsidiary of Brazilian meat titan JBS.
New York's Dow Jones Industrial Average finished up 0.39 percent at 16,698.74 points, while the broad-based S&P 500 added 0.54 percent to finish at a new closing high of 1,920.03 points.
Official data showed the US economy contracted a surprising 1.0 percent in the first quarter, but economists said a rebound was already firmly under way.
Later on Friday, dealers will digest the Chicago purchasing manager index and Michigan consumer sentiment data.

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