RBS down on Moody’s downgrade

| October 7, 2011
RBS down on Moody's downgrade

European equities markets were higher in mid-afternoon trade Friday, helped by data from the US Labor Department that showed 103,000 jobs added to the US economy, more than expected, while the unemployment rate in the United States held steady at 9.1 percent.

The FTSE 100 was up 0.16 percent to 5,299.77 in London at mid-afternoon, while the FTSE 250 had added 0.32 percent to 9,920.08 as banks were mixed after Moody’s Investors Service cut ratings on 12 UK financial institutions, including both Royal Bank of Scotland Group (LSE: RBS) and Lloyds Banking Group (LSE: LLOY).

RBS was the worst performer on the 100, down 3.41 percent in afternoon trade, while Lloyd’s was right behind with a decline of 2.69 percent, but Standard Chartered (LSE: STAN) was up 1.51 percent at the same time.

Food manufacturer Premier Foods (LSE: PFD) was leading declines on the 250 as it fell 40.5 percent on third quarter earnings that were well below predictions and sales that were down 3.6 percent on the quarter.

Most miners were up, including a 4.31 percent gain at mid-afternoon for Vedanta Resources (LSE: VED) which was at the top of the list of gainers on the 100, while African Barrick Gold (LSE: ABG) was up 5.33 percent but Talvivaara Mining Company (LSE: TALV) was down 22.08 percent.

Thomas Cook Group (LSE: TCG) was up 6.99 percent as the travel agent led gainers on the 250.

In the media sector, broadcasters were mixed as ITV (LSE: ITV) was up 3.8 percent but British Sky Broadcasting (LSE: BSY) had dropped 2.47 percent.

The FTSE Eurofirst 300 was up 0.58 percent to 946.15 in mid-afternoon trade, while at the same time the CAC-40 had added 0.38 percent to 3,086.99, the Dax was 0.53 percent higher to 5,675.09 and the IBEX had gained 0.81 percent to 8,775.1.

Markets in Asia and the Pacific region saw gains.

The Nikkei 225 was up 0.98 percent to 8,605.62 in Tokyo while the Topix index added 0.64 percent to 741.55 and the Mothers market gained 1.31 percent to 396.85.

Mobile phone operators were higher, with KDDI Corp (TYO: 9433) up 1.4 percent while Softbank (TYO: 9984) added 6.5 percent.

Banks were up on efforts in Europe to keep banks there safe from the European debt crisis, with Mitsubishi UFJ (TYO: 8306) and Sumitomo Mitsui FG (TYO: 8316) each gaining 0.6 percent.

Industrial robot maker Fanuc (TYO: 6954), which makes 75 percent of its sales overseas, added 4.3 percent and carmakers were higher, with Mazda Motor (TYO: 7261) up 2.1 percent while Nissan Motors (TYO: 7201) gained 2.2 percent, but Sony (TYO: 6758) dropped 3.7 percent after Nomura Holdings cut its recommendation on the consumer electronics manufacturer from “buy” to “neutral”.

Taiwan’s Taiex was up 1.12 percent to 7,211.96, the Straits Times Index added 1.43 percent to 2,640.3 in Singapore, Australia’s markets were higher as the Sydney Ordinaries gained 2.25 percent to 4,225 and the S&P/ASX200 was 2.29 percent higher to 4,162.9, the Sensex was up 2.79 percent to 16,232.5 in India, South Korea’s Kospi added 2.89 percent to 1,759.77 and the Hang Seng gained 3.11 percent to 17,707.

China’s markets remained closed for holidays.

New York equities markets were mixed in late morning trade, with the Dow Jones Industrial Average up 0.37 percent to 11,164.5 at around 11 a.m., while at the same time the S&P 500 had dropped 0.12 percent to 1,163.59 and the Nasdaq Composite was 0.5 percent lower to 2,494.29.

Crude oil and metals prices were a bit higher on the good news on US jobs.

November contracts for West Texas Intermediate crude were 79 cents higher to $83.38 per barrel at just before 11 a.m. on the New York Mercantile Exchange, while Brent crude was most recently reported up 6 cents to $105.79 per barrel.

December gold had added $4.50 to $1,657.70 per troy ounce at late morning in New York, while December silver was up 45 cents to $32.46 per troy ounce and December copper had gained 8 cents to $3.32 per pound.

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