Volkswagen leads European carmakers lower

Most European equities markets were higher Tuesday, but trade was thin as London’s markets remained closed for the Christmas holidays, with banks up but carmakers seeing declines in late-day trade.

The FTSE Eurofirst 300 was up 0.25 percent to 1,140.56 while the Dax had added 0.07 percent to 6,975.62 and the CAC-40 was 0.18 percent higher to 3,869.33, but the IBEX dropped 0.03 percent to 9.896.2.

Automobile manufacturers were hurt by concerns that higher interest rates in China will cut into demand, with Peugeot (Euronext: UG) and Renault (Euronext: RNO) each 0.6 percent lower during the session in Paris, while BMW (FWB: BMW) fell 2.2 percent and Volkswagen (FWB: VOW) dropped 3.2 percent in recent reports from Germany.

Most markets in the Asia-Pacific region were lower as investors worried that a new interest rate increase in China, announced over the weekend, will not be sufficient to slow inflation there.

The Nikkei 225 was 0.61 percent lower to 10,292.6 in Tokyo, while the Topix index fell 0.2 percent to 902.83 but the Mothers market managed to gain 0.32 percent to 434.93.

Shares related to the semiconductors sector were lower, with Tokyo Electron (TYO: 8035) down 1 percent while chip-testing equipment maker Advantest (TYO: 6857) dropped 1.6 percent on slower demand for testing equipment as chip manufacturers cut back on production and prices fell.

Banks managed gains as Mitsubishi UFJ (TYO: 8306) and Sumitomo Mitsui Financial Group (TYO; 8316) were each 0.5 percent higher, and Mizuho Financial Group (TYO: 8411) was up 1.3 percent.

Other decliners in the region included a 0.02 percent drop for India’s Sensex to 20,025.4, while the Taiex was down 0.24 percent to 8,870.76 in Taiwan, the Hang Seng was 0.93 percent lower to 22,621.7 in Hong Kong and the Shanghai Composite fell 1.74 percent to 2,732.99.

South Korea’s Kospi added 0.55 percent to 2,033.32, while the Straits Times Index was up 0.77 percent to 3,183.7 in Singapore.

Australia’s markets remained closed due to a public holiday.

US markets were lower in mid-morning trade after new data showing that prices for single-family homes in the United States fell 1 percent in October, from September, the fourth consecutive month that prices fell.

At just past 10 a.m. in New York, the Dow Jones Industrial Average was 0.08 percent lower to 11,545.8 while the S&P 500 was also down 0.08 percent, to 1,256.54 and the Nasdaq Composite had dropped 0.18 percent to 2,662.58.

Crude oil prices were slightly higher in New York trade, with West Texas Intermediate crude up 7 cents to trade at $91.07 per barrel at mid-morning, while metals prices were also higher as gold added more than $18 to $1,401.20 per troy ounce.

Discuss this in the Finance Markets forums

Story link: Volkswagen leads European carmakers lower