Miner Randgold Resources is only gainer on FTSE 100
European equities markets were significantly lower again Monday after Standard & Poor’s downgraded US credit from AAA to AA plus on Friday evening and reiterated the US outlook as “negative”, citing suspicions that Congress will not reverse Bush-era tax cuts or adjust entitlements as ways of bring down US debt.
The FTSE Eurofirst 300 was down 3.39 percent to 5,068.95 and saw only one gainer in London, while the FTSE 250 dropped 4.37 percent to 9,861.97 as a number of sectors, including banks, chemicals, the energy sector, financial services, insurers, industrial goods and services, health care, the media sector, home builders and real estate, utilities and the technology sector all saw no gainers at all.
Randgold Resources (LSE: RRS) was the only gainer on the 100 and in the mining sector, adding 7.43 percent after Deutsche Bank upgraded the gold miner to “buy”, while New World Resources (LSE: NWR) A shares dropped 13.94 percent as the worst performer in the sector as 17 of the 23 companies in the sector listed on the 100 and 250 fell 4 percent or more on the session, with Kazakhmys (LSE: KAZ) as the worst performer on the 100 as it dropped 10.06 percent.
Seventeen of the 20 companies listed in the energy sector were down 4 percent or more, led by oil rig builder and refurbusher Lamprell (LSE: LAM), which dropped 14.16 percent in the all-lower sector.
Premier Foods was the best performer on the 250 and the only gainer in the food and beverages sector, adding 6.25 percent on the session, while travel agent Thomas Cook Group (LSE: TCG) was down 15.88 percent as the worst performer on the 250 and in the travel and leisure sector, which saw only one gain as gambler Betfair Group (LSE: BET) added 2.8 percent.
There was likewise just one gainer in the industrial goods and services sector as banknote printer De La Rue (LSE: DLAR) added 2.16 percent, while two retailers, Home Retail Group (LSE: HOME) and Sports Direct International (LSE: SPD) saw gains, adding 3.26 percent and 0.38 percent respectively, while automobile retailer Inchcape (LSE: INCH) was the worst performer in the sector as it dropped 9.5 percent.
The FTSE Eurofirst 300 was down 3.37 percent to 942.15 while the IBEX fell 2.44 percent and saw two gainers on the session, the CAC-40 was down 4.68 percent with no gainers and all five top decliners dropping more than 9 percent each and the Dax dropped 5.02 percent and also saw no gainers on the session.
Markets in the Asia-Pacific region were lower again Monday on the downgrade of US credit by Standard & Poor’s, continuing to decline even though the G7 nations said they will do whatever is necessary to support financial markets after the downgrade.
The Nikkei 225 was down 2.18 percent to 9,094.36 in Tokyo, while the Topix index was 2.26 percent lower to 782.86 and the Mothers market dropped 4.99 percent to 413.51, with banks lower as Sumitomo Mitsui Financial Group (TYO: 6971) fell 2.2 percent and Mitsubishi UFJ (TYO: 8306), which is a big holder of US bonds, dropped 2.6 percent.
Pump maker Ebara Corp (TYO: 6361) was down 18 percent for the worst performance on the Nikkei, while exporters were lower as Kyocera Corp (TYO: 6971), which makes printers, digital imaging equipment and electronic components, was 2.3 percent lower, Nissan Motors (TYO: 7201) was down 2.7 percent after a weaker US dollar led to a reduced earnings outlook, and consumer electronics maker Sony (TYO: 6758), which gets 40 percent of its revenue from Europe and the United States, dropped 3.8 percent.
Elsewhere in the region, India’s Sensex was down 1.82 percent to 16,990.2, the Hang Seng fell 2.17 percent to 20,490.6 in Hong Kong, Australia’s markets were down as the Sydney Ordinaries dropped 2.71 percent to 4,056.7 and the S&P/ASX200 was 2.91 percent lower to 3,986.1, the Straits Times Index was down 3.7 percent to 2,884, the Shanghai Composite fell 3.79 percent to 2,526.82, and the Taiex and the Kospi each dropped 3.82 percent, to 7,552.8 in Taiwan and to 1,869.46 in South Korea.
New York equities markets were also lower on the S&P downgrade, which came after the close of trade on Friday, with the Dow Jones Industrial Average down 2.91 percent to 11,111.2 in midday trade, while the S&P 500 and the Nasdaq Composite each down 3.66 percent, to 1,155.5 and 2,439.82 respectively.
Crude oil dropped on the news of the downgrade, with West Texas Intermediate and Brent crude each down by more than $3.50 per barrel at midday in New York.
Metals prices were mixed as gold went above $1,700 per troy ounce for the first time in history and was trading at up $61.60 at $1,713.40 per troy ounce at just past 12:30 p.m. in New York while silver was up $1.17 to $39.39 per troy ounce but copper had dropped 14 cents to $3.98 per pound at the same time in New York.