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Thursday 15th of April 2010
April 13, 2010    

Petropavlovsk leads miners lower on Alcoa results

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by Elaine Frei
Petropavlovsk leads miners lower on Alcoa results

Most European equities markets were lower Tuesday as the US earnings season got off to a less-than-stellar start as US aluminium producer Alcoa (NYSE: AA) released results after the close of trade Monday which were below expectations, with sales not up to anticipated levels.

The FTSE 100 fell 0.28 percent to 5,761.66 in London, while the FTSE 250 dropped 0.6 percent to 10,418.88.

Miners led decliners on both the 100 and the 250 on the disappointing news from Alcoa and on new data on bank lending in China which caused concern that metals demand their could decline.

Gold miner Petropavlovsk (LSE: POG) fell the most in the sector, on the 250 and in London as it dropped 4.25 percent.

Over on the 100, the top five declines all came from the mining sector, led by Kazakhmys (LSE: KAZ), which was down 3.17 percent and followed by Lonmin (LSE: LMI) with a decline of 2.51 percent while gold and silver miner Fresnillo (LSE: FRES) was 2.42 percent lower, Antofagasta (LSE: ANTO) fell 2.3 percent and Vedanta Resources (LSE: VED) dropped 2.26 percent.

The only gainer in the sector was iron-ore miner Ferrexpo (LSE: FXPO), which added 0.565 percent on the session.

Retailers were mixed after the British Retail Consortium reported that retail sales in stores open at least a year were up 4.4 percent in March.

Home shopping retailer N Brown Group (LSE: BWNG) was the best performer in the sector as it added 4.01 percent, while home furnishings retailer Dunelm Group (LSE: DNLM) fell the most in the sector with a decline of 3.07 percent.

DIY retailer Kingfisher (LSE: KFG) added 2.71 percent while Tesco (LSE: TSCO) was 1.42 percent higher.

Pubs operator Punch Taverns (LSE: PUB) topped gainers in London as it added 7.1 percent, while the best performer on the 100 was investment manager Man Group (LSE: EMG), which gained 2.72 percent.

The FTSE Eurofirst 300 was down 0.19 percent to 1,099.34 while the Dax fell 0.32 percent to 6,230.83 and the CAC-40 dropped 0.46 percent to 4,031.99, but the IBEX managed to gain fractionally to 11,461.

Most markets in the Asia-Pacific region were lower on the session on the disappointing results from Alcoa.

The Nikkei 225 was 0.81 percent lower to 11,161.23 in Tokyo, while the Topix index fell 0.64 percent to 988.44 but the Mothers market managed a gain of 0.47 percent to 482.19.

Many exporters were lower on a stronger yen, with Toyota Motor (TYO: 7267) down 0.5 percent while Honda Motor (TYO: 7267) fell 0.9 percent, but Isuzu Motors (TYO: 7202) added 3.1 percent on an upgrade from “neutral” to “buy” from Nomura Securities.

Traders were lower after Mitsubishi UFJ Securities issued downgrades in the sector, sending Kawasaki Kisen (TYO: 9107) down 1.6 percent while Mitsui O.S.K. Lines (TYO: 9104) dropped 2.6 percent.

Other decliners included the Hang Seng, which was 0.16 percent lower to 22,103.53, while India’s Sensex fell 0.17 percent to 17,821.96 and the Straits Times Index was down 0.19 percent to 2,971.6.

In Australia the S&P/ASX200 and the Sydney Ordinaries each dropped 0.66 percent, to 4,951.6 and 4,978.4 respectively as miners declined there, while Taiwan’s Taiex was 1.08 percent lower to 8,029.73.

Not all markets were lower, however, as the Kospi added 0.02 percent to 1,710.59 in South Korea while the Shanghai Composite gained 1.02 percent to 3,161.25.

Banks managed gains in China after data released yesterday showing that bank lending fell in March led to speculation that the central bank there will not hike bank reserve requirements this year as often or by as much as had been forecast.

China Construction Bank Corp (SSE: 601939) was up 1.3 percent while Industrial & Commercial Bank of China Ltd. (SSE: 601398) gained 1.4 percent.

New York markets were mixed in midday trade as the Dow Jones Industrial Average added 0.02 percent to 11,008.69, but the S&P 500 had dropped 0.24 percent to 1,193.64 and the Nasdaq Composite was 0.13 percent lower to 2,454.56.

The Dow’s gains came as General Electric (NYSE: GE) was up 1.5 percent at around 12.30 p.m. while at the same time DIY retailer Home Depot (NYSE: HD) had added 2.3 percent.

The price of crude oil was lower in midday trade, while among metals copper was higher but gold and sliver prices had slipped lower.

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