Barclays Bank leads London banking sector lower

| August 10, 2011 | 0 Comments
Barclays Bank leads London banking sector lower

European equities markets were substantially lower Wednesday on concerns that the debt crisis there is spreading and on skepticism that moves by the US Federal Reserve will keep the US economic recovery from slowing.

The FTSE 100 was down 3.05 percent to 5,007.16 in London, while the FTSE 250 dropped 1.98 percent to 9,890.96 as banks declined, led by an 8.7 percent drop for Barclays Bank (LSE: BARC) and Standard Chartered (LSE: STAN), which was down 7.52 percent as both banks traded ex-dividend.

Insurer Standard Life (LSE: SL) led gains on the 100, adding 5.74 percent after it said operating profit was up in the first half of the year, exceeding analyst estimates for the period, while IT group Micro Focus International (LSE: MCRO) led gains on the 250 as it added 13.16 percent.

Oil and gas explorer and power generator Essar Energy (LSE: ESSR) was the worst performer on the 100 and in the energy sector, dropping 12.6 percent, while online gambler Digital Entertainment (LSE: BPTY) led declines in the travel and leisure sector and on the 250 as it fell 9.68 percent.

The mining sector was lower, but managed five gains, led by African Barrick Gold (LSE: ABG), which added 4.68 percent, while Kazakymys (LSE: KAZ) led declines as it dropped 7.74 percent as eight miners dropped more than 4 percent on the session.

The FTSE Eurofirst 300 was down 3.82 percent to 911.65, while the Dax fell 5.13 percent to 5,613.42 and saw just two gainers, the CAC-40 was 5.45 percent lower to 3,002.99 and had no gainers, and the IBEX dropped 5.49 percent to 7,966 and also saw no gains.

Markets in the Asia-Pacific region were mostly higher on more optimism regarding the US Federal Reserve’s move to hold interest rates steady on Tuesday after the Fed vowed to hold rates low until the middle of 2013 and said it could take other actions to aid the US economy.

The Nikkei 225 was up 1.05 percent to 9,038.74 in Tokyo, while the Topix index added 0.82 percent to 776.73 and the Mothers market gained 2.66 percent to 429.25, with Tokyo Electric Power (TYO: 9501) up 15 percent after the utility’s president said government support will help it from going under, while Kansai Electric Power (TYO: 9503) added 8.3 percent.

South Korea’s markets were up 0.27 percent to 1,806.24 after being up more earlier, with gains reduced after South Korea’s military said it fired artillery after it heard explosions from the North at a disputed portion of the border between the two nations, while the Shanghai Composite added 0.91 percent to 2,549.18, India’s Sensex was 1.62 percent higher to 17,130.5, the Hang Seng gained 2.34 percent to 19,783.7 in Hong Kong, Australia’s markets were higher as the S&P/ASX200 was up 2.64 percent to 4,141.3 and the Sydney Ordinaries added 2.7 percent to 4,207.4, and Taiwan’s Taiex was 3.25 percent higher to 7,736.32.

The Straits Times Index bucked trends in Singapore, dropping 2.18 percent to 2,821.09.

New York equities markets were lower as investors worried about weakness in the economy, not only in the United States but in Europe as well, with the Dow Jones Industrial Average down 3.34 percent at around 12:30 p.m. in New York, while at the same time the S&P 500 had dropped 3.16 percent to 1,135.47 and the Nasdaq Composite was 2.77 percent lower to 2,413.7.

Crude oil prices were up in midday trade after the US Energy Information Administration said that US crude stockpiles dropped by 5.2 million barrels last week, with West Texas Intermediate crude and Brent crude each up by more than $2 per barrel.

Gold was again in record territory as New York prices for the precious metal added $43.50 to $1,786.50 per troy ounce in midday trade as investors looked for safe places to put their cash, while silver added $1.88 per troy ounce to just over $39 per troy ounce but copper dropped 6 cents to $3.91 per pound.

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