Fresnillo down on silver prices

| September 12, 2011 | 0 Comments
Fresnillo down on silver prices

European equities markets were lower Monday on the possibility that Greece could default soon and on speculation that Moody’s Investors Service could cut its rating on several big banks with holdings tied to Greece.

The FTSE 100 was down 1.63 percent to 5,129.62 in London, while the FTSE 250 dropped 1.65 percent to 9,983.75 as banks, miners and the energy sector were among sectors seeing declines.

Miners were the biggest decliners on both the 100 and the 250, with gold and silver miner Fresnillo (LSE: FRES) down most in the sector and on the 100 as it dropped 7.49 percent after the price for silver for immediate delivery declined, while coal miner New World Resources (LSE: NWR) A shares were down 6.77 percent to lead decliners on the 250.

There were just three gainers among miners, with Gem Diamonds (LSE: GEMD) doing best as it added 2.86 percent.

Pubs and restaurants operator Mitchells & Butlers (LSE: MAB) was the best of just four gainers in the travel and leisure sector as it added 7.04 percent to lead gains on the 250, while investment managers Man Group (LSE: EMG) was the best performer on the 100.

Charter International (LSE: CHTR) added 6.59 percent after US-based pump manufacturer Colfax Corp (NYSE: CFX) agreed to buy the engineering group.

Banks were lower as Royal Bank of Scotland Group (LSE: RBS) dropped 3.4 percent to lead declines in the sector,, but Standard Chartered (LSE: STAN) managed to add 0.72 percent.

Banks were the biggest decliners on the CAC-40 in Paris on speculation that Moody’s Investors Service could cut its ratings on several big banks with holdings tied to Greece, with BNP Paribas (Euronext: BNP) down 12.35 percent while Societe Generale (Euronext: GLE) was 10.75 percent lower and Credit Agricole (Euronext: ACA) dropped 10.64 percent.

Additionally, over on the Dax, Commerzbank (FWB: CBK) led declines as it dropped 8.32 percent, followed by a 7.3 percent decline for Deutsche Bank (FWB: DBK).

The FTSE Eurofirst 300 was down 2.52 percent to 892.46 while the Dax fell 2.27 percent to 5.072.33, the IBEX was 3.41 percent lower to 7,640.7 and the CAC-40 dropped 4.03 percent to 2,854.81, with just two gainers each on the Dax and the CAC-40 and no gainers at all on the IBEX.

Markets in Asia and the Pacific were lower on concerns that Greece could be near default with fears that the debt crisis in Europe could hurt the global banking system.

The Nikkei 225 was down 2.31 percent to 8,535.67 in Tokyo, while the Topix index was 1.91 percent lower to 741.26 and the Mothers market dropped 1.97 to 418.99 as banks declined on the worries about how the European debt crisis will affect banks.

Mizuho Financial Group (TYO: 8411) was down 1.8 percent while Sumitomo Mitsui Financial Group (TYO: 8316) was 2.4 percent lower and Mitsubishi UFJ (TYO: 8306) dropped 2.7 percent.

Exporters were hurt after the yen strengthened and on concerns about the situation in Europe, with consumer electronics manufacturer Sony (TYO: 6758), which makes 21 percent of its sales in Europe, down 3.4 percent, while Sharp Corp (TYO: 6753) dropped 5 percent after Mizuho Securities reduced its target share price on the flat screen manufacturer.

Carmaker Toyota Motor (TYO: 7203) was down 2.1 percent, while Honda Motor (TYO: 7267) was 3.8 percent lower on a recall of its Pilot SUVs due to a seat belt problem.

Elsewhere in the region, India’s Sensex was down 2.17 percent to 16,501.7, the Straits Times Index fell 2.89 percent to 2,743.58 in Singapore, Australia’s markets were lower as the Sydney Ordinaries dropped 3.56 percent to 4,125.1 and the S&P/ASX200 was 3.72 percent lower to 4,038.5 and the Hang Seng was down 4.21 percent to 19,030.5 in Hong Kong.

Markets in China, Taiwan and South Korea were closed in observance of holidays.

New York equities markets were lower in midday trade, with the Dow Jones Industrial Average down 1.08 percent to 10,873.7 while at the same time the S&P 500 had dropped 1.03 percent to 1,142.36 and the Nasdaq Composite was 0.48 percent lower to 2,456.12.

Crude oil prices were higher as buyers took advantage of lower prices after the cost of a barrel of oil dropped overnight on the possibility that Moody’s will cut its ratings on big French banks, with West Texas Intermediate crude up $1.11 to $88.35 per barrel at midday on the New York Mercantile Exchange, while Brent crude was recently 20 cents higher to $112.97 per barrel on the ICE Futures Europe exchange in London.

Metals prices were lower, with December contracts for gold down $44.90 to $1,814.60 per troy ounce in midday trade in New York on concerns about European banks and as investors sold their holdings to cover losses in the equities markets, while silver was down $1.25 to $40.38 per troy ounce.

Copper prices were hurt by concerns over the debt crisis in Europe and on demand fears, with December copper down 4 cents to $3.96 per pound in New York while three-month contracts dropped $66.50 to $8,754.50 per tonne on the London Metal Exchange.

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