Euro stocks end down on Fed action fears

AFP/LondonEuropean stocks ended down yesterday on fears the Fed will begin cutting monetary stimulus as encouraging eurozone manufacturing numbers failed to impress markets, traders said. London’s FTSE 100 index of leading shares closed down 0.88% to 6,525.12 points, Frankfurt’s Dax 30 index dropped 0.76% to 8,285.80 points, and the Cac 40 in Paris shed 0.71% to finish at 3,920.67 points. Milan closed down 0.91% Madrid slid 0.44%. “Traders continue to concern themselves with the likely impact if stimulus provided by Fed asset purchases is prematurely withdrawn,” said Lex Young, a senior sales trader at CMC Markets UK. “Small beats on PMI data across Europe this morning failed to inspire much change to the generally cautious mood, as the ‘all news is good news’ mantra has taken an about turn over the past 2 weeks.” The Markit Eurozone Composite Purchasing Managers Index rose to a 15-month high of 48.3 in May, up from an initial reading for the month of 47.8 and compared with a four-month low of 46.7 in April. The index however remained below the boom-and-bust line of 50 points, indicating that the sector continued to contract overall for a 22nd consecutive month. The euro rosed to $1.3092 from $1.2996 late in New York on Friday. The dollar slipped to ¥99.20 from ¥100.37 on Friday. On the London Bullion Market, the price of gold climbed to finish at $1,402.50 an ounce from $1,394.50 on Friday. US stocks traded mixed, with the Dow Jones Industrial Average edging up 0.17%, while the broad-based S&P 500 fell 0.48% and tech-rich Nasdaq Composite shed 0.90%. The latest data on US manufacturing was downbeat. The Institute for Supply Management’s purchasing managers index (PMI) on US manufacturing unexpectedly slumped into contraction territory in May, at 49.0, down from a growth reading of 50.7 in April. Eyes were also turning towards a series of key US economic statistics due later in the week, and policy meetings of the European Central Bank and Bank of England. The car sector was meanwhile in focus as data on Monday revealed that new car registrations in France, a key indicator of the country’s economic health, dropped sharply in May, with Renault and Citroen the worst affected. A total of 148,554 new cars were registered last month, a 10.3% drop compared to the same period in 2012, according to statistics published by France’s industry group for automakers, CCFA. Renault shares ended the day down 2.09% at €58.51 on the Paris stock exchange.