Eurasian Natural Resources leads declines in London

| May 4, 2010 | 0 Comments
Eurasian Natural Resources leads declines in London

European equities markets were significantly lower Tuesday as miners, the oil sector and banks all took plunges.

The FTSE 100 was down 2.56 percent to 5,411.11 in London after Monday’s bank holiday closure, while the FTSE 250 dropped 2.07 percent to 10,151.44.

Commodities shares fell as new attempts were made to stop an oil spill in the Gulf of Mexico and as the new mining profits tax to take effect in Australia in 2012 made investors worry about profits.

The mining sector was down in London as miners were the five biggest losers on the 100 and the three biggest on the 250 and thirteen mining companies lost 5 percent or more on the session.

Eurasian Natural Resources (LSE: ENRC) led losers in the sector, on the 100 and in London generally as it dropped 11.34 percent, followed on the 100 by Antofagasta with a decline of 8.66 percent while BHP Billiton (LSE: BLT) fell 7.92 percent, Xstrata (LSE: XTA) was down 7.87 percent and Kazakhmys (LSE: KAZ) was 7.41 percent lower.

Over on the 250, Talvivaara Mining Company (LSE: TALV) turned in the worst performance as it fell 9.51 percent, while Ferrexpo (LSE: FXPO) was down 9.15 percent and Aquarius Platinum Ltd (LSE: AQP) dropped 7.81 percent.

The smallest declines in the sector came for Hochschild Mining (LSE: HOC), which was down 3.01 percent, and for paper producer Mondi (LSE: MNDI), which dropped 2.72 percent.

In the energy sector, meanwhile, BP (LSE: BP) was down 2.95 percent as it attempted to stop one of tree leaks at a well in the Gulf of Mexico where a drilling rig exploded and sank on 20 April, while the sector was generally lower as crude oil prices fell.

Banks were lower as investors worried that Greece’s debt crisis could spread to other economies in the region, with Lloyds Banking Group (LSE: LLOY) dropping the most in London with a decline of 7.39 percent.

Banks also fell elsewhere in Europe as BNP Paribas (Euronext: BNP) was down 6.12 in Paris while in Spain Banco de Valencia (BMAD: BVA) fell 7.3 percent and Banco Santander (BMAD: SAN) was down 7.4 percent and in Greece Piraeus Bank (Athex: TPEIR) was 11 percent lower and National Bank of Greece (Athex: ETE) dropped 13 percent.

The FTSE Eurofirst 300 was down 2.95 percent to 1,033.18 while the Dax fell 2.6 percent to 6,006.86, the CAC-40 was 3.64 percent lower to 3,689.29 and the IBEX dropped 5.41 percent to 9,859.1.

There were no gainers on the CAC-40 on the session and only one on the Dax, and that only an 0.12 percent advance for personal care products manufacturer Beiersdorf AG (FWB: BEI).

Markets in the Asia-Pacific region were lower on the session on continuing fallout from news out of China and Australia.

New data from China showed that manufacturing there was at a six-month low in April as the Chinese Purchasing Managers’ Index fell to 55.4 in April from 57 in March, while banks were hurt in their first trading day since the central bank there once again raised reserve requirements for Chinese banks.

Meanwhile, miners with interests in Australia were down again on concerns about a 40 percent tax on mining profits the government there will impose beginning in 2012, while the Reserve Bank of Australia raised a key interest rate by a quarter of a percentage point to 4.5 percent, the sixth increase in the past seven meetings of the central bank.

The Kospi was down 0.14 percent to 1,718.75, while Hong Kong’s Hang Seng fell 0.23 percent to 20,763.05 as Yanzhou Coal Mining Co (SEHK: 1171), which owns Australian miner Felix Resources Ltd), dropped 2.9 percent on the new Australian mining profits tax.

Taiwan’s Taiex was 0.27 percent lower to 7,930.77.

In Australia, the S&P/ASX200 fell 1.01 percent to 4,737.1 while the Sydney Ordinaries dropped 1.12 percent to 4,753.3.

Among Australian miners, BHP Billiton (ASX: BHP) was down 2.4 percent and Rio Tinto (LSE: RIO) was 2.8 percent lower.

The Shanghai Composite fell 1.23 percent to 2,835.28 after a day off for a holiday on Monday as China Construction Bank Corp (SSE: 601939) fell 0.8 percent and Industrial & Commercial Bank of China (SSE: 601398) dropped 1.1 percent.

India’s Sensex was 1.43 percent lower to 17,137.14 and the Straits Times Index was down 1.46 percent to 2,901.18 in Singapore.

Tokyo’s markets remained closed in observance of Greenery Day, part of its Golden Week celebrations.

Concerns about the possible spread of Greece’s debt crisis to other European economies also hurt New York markets, sending the Dow Jones Industrial Average down 2.01 percent to 10,927.82 in midday trade, while at the same time the S&P 500 was 2.26 percent lower to 1,175.11 and the Nasdaq Composite had dropped 3.09 percent to 2,421.62.

The price of crude oil was down in New York, with contracts for West Texas Intermediate crude down by more than $3 per barrel in midday trade, while metals prices were also lower.

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