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March 14, 2011    

Centrica lower on nuclear plant uncertainties

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by Elaine Frei
Centrica lower on nuclear plant uncertainties

European equities markets were lower Monday as reinsurers saw declines on predicitons that claims of up to $34 billion dollars could be filed in relation to the earthquake and tsunami in Japan on Friday, while utilities declined on the possible repercussions to the building of nuclear power plants after two plants in Japan suffered explosions in the wake of the disaster there.

The FTSE 100 was down 0.92 percent to 5,775.24 in London, while the FTSE 250 dropped 0.52 percent to 11,349.7.

The utilities sector was mostly lower in London, with Centrica (LSE: CNA), which has interests in the nuclear power industry, was down 1.9 percent, while National Grid (LSE: NG) dropped 2.37 percent for the worst performance in the sector.

London’s insurance sector was also lower, with insurer and reinsurer Catlin Group (LSE: CGL) having the worst day in the sector as it fell 3.17 percent.

Power generator rental group Aggreko (LSE: AGK) was the best performer on the 100, adding 8.24 percent on the sector, while tech group Imagination Technologies (LSE: IMG) was up 5.48 percent to lead gains on the 250.

The energy sector was mixed, with oil explorer EnQuest (LSE: ENQ) adding 3.99 percent as the best performer in the sector, while BG Group (LSE: BG) added 3.7 percent on the probability that Japan will increase its imports of liquefied natural gas.

AMEC (LSE: AMEC), which provides engineering services to the energy industry, was the worst performer in the energy sector, dropping 3.21 percent.

Fashion house Burberry Group (LSE: BRBY) was 4.34 percent lower, leading declines on the 100, because up to 20 percent of its operating profit comes through Japan due to how its licensing is structured.

Most miners were lower, with Kenmare Resources (LSE: KMR) down 5.33 percent for the worst performance on the 250 and in the basic resources sector, while Centamin Egypt, (LSE: CEY) had the best day among miners, adding 3.13 percent.

Markets in the Asia-Pacific region were mixed, with Tokyo’s markets leading declines as the nation continues to assess loss of life and damage after the earthquake and tsunami that struck the northeast part of the country on Friday.

The Nikkei 225 ended the session down 6.18 percent to 9,620.49, while the Topix index dropped 7.49 percent to 846.96 after starting trade late, and the Mothers market was 17.17 percent lower, its biggest decline ever, to 409.89.

A record 5.08 billion shares were traded during the session.

Tokyo Electric Power (9501) dropped 24 percent as it announced probably electricity saving measures, and while one of its reactors at the Fukushima nuclear power plant remains in danger of meltdown.

The power company announced plans for limited blackouts in some parts of suburban Tokyo and other cities, and Tokyo trains will run on a reduced schedule in order to save electricity, while it was said that with several nuclear power plants down the resulting shortage of electricity could hurt industrial production for some time to come.

Toshiba Corp (TYO: 6502), which builds nuclear reactors, dropped 16 percent, while Japan’s biggest property and casualty insurer, Tokio Marine Holdings Inc (TYO: 8766) was 12 percent lower.

Construction companies were up as the magnitude of rebuilding that will be required became clear, with Obayashi Corp (TYO: 1802) and Shimizu Corp (TYO: 1803) each up 11 percent while Taisei Corp (TYO: 1801) added 20 percent and Kajima Corp (TYO; 1812) gained 22 percent.

Carmakerrs were lower, with Honda Motor (TYO: 7267) down 6.5 percent, while Toyota Motor (TYO: 7203) was 6.5 percent lower and Nissan Motor (TYO: 7201) dropped 9.5 percent as thousands of new vehicles ready for shipment were damaged in the quake and tsunami and after both Toyota and Honda said they were closing factories.

The Bank of Japan made plans to pump trillions of yen into the monetary system in order to insure liquidity, but some analysts said the Bank’s moves were not sufficient.

Australia’s markets were also lower, with the S&P/ASX200 down 0.4 percent to 4,626.4 while the Sydney Ordinaries dropped 0.52 percent to 4,710.1.

Singapore’s Straits Times Index was 0.41 percent lower to 3,030.86 and the Taiex was down 0.56 percent to 8,520.02 in Taiwan.

Gainers in the region included the Shanghai Composite, which added 0.13 percent to 2,937.63, while Hong Kong’s Hang Seng was up 0.41 percent to 23,345.9, the Kospi was 0.8 percent higher to 1,971.23 in South Korea and India’s Sensex gained 1.46 percent to 18,439.5.

New York equities markets were lower in afternoon trade, with the Dow Jones Industrial Average 0.87 percent lower to 11,940 at just before 2 p.m. local time as the US switched to Daylight Savings Time for the summer, while at the same time the S&P 500 had dropped 0.98 percent to 1,291.55 and the Nasdaq Composite was down 0.74 percent to 2,695.58.

Crude oil prices were slightly lower, with April contracts for West Texas Intermediate crude down 44 cents to 100.72 per barrel, while Brent crude was lately down 9 cents to $113.75 per barrel on the ICE Futures Europe exchange in London.

Gold prices were up in New York trade, but silver and copper prices had dropped in afternoon trade.

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